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MONTHLY BULLET INMAY

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MONTHLY BULLET IN

MAY 2011

In 2011 all ECBpublications

feature a motiftaken from

the €100 banknote.

© European Central Bank, 2011

Address Kaiserstrasse 29

60311 Frankfurt am Main

Germany

Postal address Postfach 16 03 19

60066 Frankfurt am Main

Germany

Telephone +49 69 1344 0

Website http://www.ecb.europa.eu

Fax +49 69 1344 6000

This Bulletin was produced under the responsibility of the Executive Board of the ECB. Translations are prepared and published by the national central banks.

All rights reserved. Reproduction for educational and non-commercial purposes is permitted provided that the source is acknowledged.

The cut-off date for the statistics included in this issue was 4 May 2011.

ISSN 1561-0136 (print)

ISSN 1725-2822 (online)

3ECB

Monthly Bulletin

May 2011

CONTENTS

EDITORIAL 5

ECONOMIC AND MONETARY

DEVELOPMENTS

The external environment of the euro area 9

Monetary and fi nancial developments 18

Prices and costs 47

Output, demand and the labour market 56

Boxes:

Global economic repercussions 1

of the earthquake in Japan 10

The results of the April 2011 bank 2

lending survey for the euro area 22

The results of the “Survey on the access 3

to fi nance of small and medium-sized

enterprises in the euro area” 38

Integrated euro area accounts for the 4

fourth quarter of 2010 41

Results of the ECB Survey of 5

Professional Forecasters for the

second quarter of 2011 51

The6 measurement and prediction

of the euro area business cycle 57

Euro7 area trade in services:

specialisation patterns and recent

trends 61

ARTICLES

Patterns of euro area and US

macroeconomic cycles – what has been

different this time? 69

The external representation of the EU

and EMU 87

EURO AREA STATISTICS S1

ANNEXES

Chronology of monetary policy

measures of the Eurosystem I

Publications produced by the European

Central Bank V

Glossary V I I

4ECB

Monthly Bulletin

May 2011

ABBREVIATIONS

COUNTRIES LU Luxembourg

BE Belgium HU Hungary

BG Bulgaria MT Malta

CZ Czech Republic NL Netherlands

DK Denmark AT Austria

DE Germany PL Poland

EE Estonia PT Portugal

IE Ireland RO Romania

GR Greece SI Slovenia

ES Spain SK Slovakia

FR France FI Finland

IT Italy SE Sweden

CY Cyprus UK United Kingdom

LV Latvia JP Japan

LT Lithuania US United States

OTHERS

BIS Bank for International Settlements

b.o.p. balance of payments

BPM5 IMF Balance of Payments Manual (5th edition)

CD certifi cate of deposit

c.i.f. cost, insurance and freight at the importer’s border

CPI Consumer Price Index

ECB European Central Bank

EER effective exchange rate

EMI European Monetary Institute

EMU Economic and Monetary Union

ESA 95 European System of Accounts 1995

ESCB European System of Central Banks

EU European Union

EUR euro

f.o.b. free on board at the exporter’s border

GDP gross domestic product

HICP Harmonised Index of Consumer Prices

HWWI Hamburg Institute of International Economics

ILO International Labour Organization

IMF International Monetary Fund

MFI monetary fi nancial institution

NACE statistical classifi cation of economic activities in the European Union

NCB national central bank

OECD Organisation for Economic Co-operation and Development

PPI Producer Price Index

SITC Rev. 4 Standard International Trade Classifi cation (revision 4)

ULCM unit labour costs in manufacturing

ULCT unit labour costs in the total economy

In accordance with EU practice, the EU countries are listed in this Bulletin using the alphabetical order of the country names in the national languages.

5ECB

Monthly Bulletin

May 2011

Based on its regular economic and monetary

analyses, the Governing Council decided at its

meeting on 5 May 2011 to keep the key ECB

interest rates unchanged following the 25-basis

point increase on 7 April 2011. The information

that has become available since then confi rms

the assessment that an adjustment of the very

accommodative monetary policy stance was

warranted. The Governing Council continues

to see upward pressure on overall infl ation,

mainly owing to energy and commodity prices.

While the monetary analysis indicates that the

underlying pace of monetary expansion is still

moderate, monetary liquidity remains ample

and may facilitate the accommodation of price

pressures. Furthermore, recent economic data

confi rm the positive underlying momentum

of economic activity in the euro area, with

uncertainty continuing to be elevated. All in

all, it is essential that recent price developments

do not give rise to broad-based infl ationary

pressures. Infl ation expectations in the euro

area must remain fi rmly anchored in line with

the aim of maintaining infl ation rates below,

but close to, 2% over the medium term. Such

anchoring is a prerequisite for monetary policy

to make an ongoing contribution towards

supporting economic growth and job creation

in the euro area. With interest rates across the

entire maturity spectrum remaining low and the

monetary policy stance still accommodative,

the Governing Council will continue to monitor

very closely all developments with respect to

upside risks to price stability. Maintaining price

stability over the medium term is the guiding

principle, which the Governing Council applies

when assessing new information, forming

judgements and deciding on any further

adjustment of the accommodative stance of

monetary policy.

As stated on previous occasions, the provision

of liquidity and the allotment modes for

refi nancing operations will also be adjusted

when appropriate, taking into account the

fact that all the non-standard measures taken

during the period of acute fi nancial market

tensions are, by construction, temporary

in nature.

With regard to the economic analysis, following

the 0.3% quarter-on-quarter increase in euro

area real GDP in the fourth quarter of 2010,

recent statistical releases and survey-based

indicators point towards a continued positive

underlying momentum of economic activity in

the euro area during the fi rst quarter of 2011 and

at the beginning of the second quarter. Looking

ahead, euro area exports should be supported by

the ongoing expansion in the world economy.

At the same time, taking into account the

high level of business confi dence in the euro

area, private sector domestic demand should

contribute increasingly to economic growth,

benefi ting from the accommodative monetary

policy stance and the measures adopted to

improve the functioning of the fi nancial system.

However, activity is expected to continue to be

dampened somewhat by the process of balance

sheet adjustment in various sectors.

In the Governing Council’s assessment, the

risks to this economic outlook remain broadly

balanced in an environment of elevated

uncertainty. On the one hand, global trade may

continue to grow more rapidly than expected,

thereby supporting euro area exports. Moreover,

strong business confi dence could provide more

support to domestic economic activity in the euro

area than currently expected. On the other hand,

downside risks relate to the ongoing tensions

in some segments of the fi nancial markets that

may potentially spill over to the euro area real

economy. Downside risks also relate to further

increases in energy prices, particularly in view

of ongoing geopolitical tensions in North

Africa and the Middle East, and to protectionist

pressures and the possibility of a disorderly

correction of global imbalances. Finally, there

are still potential risks stemming from the

economic impact on the euro area and elsewhere

of the natural and nuclear disasters in Japan.

With regard to price developments, euro area

annual HICP infl ation was 2.8% in April

according to Eurostat’s fl ash estimate, after

2.7% in March. The increase in infl ation rates

during the fi rst four months of 2011 largely

refl ects higher commodity prices. Looking

EDITORIAL

6ECB

Monthly Bulletin

May 2011

ahead, infl ation rates are likely to stay clearly

above 2% over the coming months. Upward

pressure on infl ation, mainly from energy and

commodity prices, is also discernible in the

earlier stages of the production process. It is

of paramount importance that the rise in HICP

infl ation does not translate into second-round

effects in price and wage-setting behaviour

and lead to broad-based infl ationary pressures.

Infl ation expectations must remain fi rmly

anchored in line with the Governing Council’s

aim of maintaining infl ation rates below, but

close to, 2% over the medium term.

Risks to the medium-term outlook for price

developments remain on the upside. They relate,

in particular, to higher than assumed increases in

energy prices, not least on account of the ongoing

political tensions in North Africa and the Middle

East. More generally, strong economic growth in

emerging markets, supported by ample liquidity

at the global level, may further fuel commodity

price rises. Moreover, increases in indirect taxes

and administered prices may be greater than

currently assumed, owing to the need for fi scal

consolidation in the coming years. Finally, risks

also relate to stronger than expected domestic

price pressures in the context of the ongoing

recovery in activity.

Turning to the monetary analysis, the annual

growth rate of M3 increased to 2.3% in March

2011, from 2.1% in February. Looking through

the recent volatility in broad money growth

caused by special factors, M3 growth has

continued to edge up over recent months. The

annual growth rate of loans to the private sector

remained broadly unchanged at 2.5% in March,

after 2.6% in February. Overall, the underlying

pace of monetary expansion is gradually picking

up, but it remains moderate. At the same time,

monetary liquidity accumulated prior to the

period of fi nancial market tensions remains

ample and may facilitate the accommodation of

price pressures in the euro area.

Looking at M3 components, the annual growth

rate of M1 remained broadly unchanged in

March, while that of other short-term deposits

increased. The development partly refl ects the

gradual increase in the remuneration of these

deposits over recent months. At the same time,

the steep yield curve implies a dampening

impact on overall M3 growth, as it reduces the

attractiveness of monetary assets compared

with more highly remunerated longer-term

instruments outside M3.

On the counterpart side, there has been a further

slight strengthening in the growth of loans to

non-fi nancial corporations, which rose to 0.8%

in March, after 0.6% in February. The growth

of loans to households was 3.4% in March,

compared with 3.0% in February. Looking

through short-term volatility, the latest data

confi rm a continued gradual strengthening in the

annual growth of lending to the non-fi nancial

private sector.

The overall size of bank balance sheets has

remained broadly unchanged over the past

few months, notwithstanding some volatility.

It is important that banks continue to expand

the provision of credit to the private sector in an

environment of increasing demand. To address

this challenge, where necessary, it is essential

for banks to retain earnings, to turn to the

market to strengthen further their capital bases

or to take full advantage of government support

measures for recapitalisation. In particular,

banks that currently have limited access to

market fi nancing urgently need to increase their

capital and their effi ciency.

To sum up, based on its regular economic and

monetary analyses, the Governing Council

decided to keep the key ECB interest rates

unchanged following the 25-basis point increase

on 7 April 2011. The information that has become

available since then confi rms the assessment

that an adjustment of the very accommodative

monetary policy stance was warranted. The

Governing Council continues to see upward

pressure on overall infl ation, mainly owing to

energy and commodity prices. A cross-check

with the signals coming from the monetary

analysis indicates that, while the underlying pace

of monetary expansion is still moderate, monetary

7ECB

Monthly Bulletin

May 2011

EDITORIAL

liquidity remains ample and may facilitate the

accommodation of price pressures. Furthermore,

recent economic data confi rm the positive

underlying momentum of economic activity in

the euro area, with uncertainty continuing to be

elevated. All in all, it is essential that recent price

developments do not give rise to broad-based

infl ationary pressures. Infl ation expectations in

the euro area must remain fi rmly anchored in

line with the aim of maintaining infl ation rates

below, but close to, 2% over the medium term.

Such anchoring is a prerequisite for monetary

policy to make an ongoing contribution towards

supporting economic growth and job creation

in the euro area. With interest rates across the

entire maturity spectrum remaining low and the

monetary policy stance still accommodative, the

Governing Council will continue to monitor very

closely all developments with respect to upside

risks to price stability. Maintaining price stability

over the medium term is the guiding principle,

which the Governing Council applies when

assessing new information, forming judgements

and deciding on any further adjustment of the

accommodative stance of monetary policy.

Turning to fi scal policies, current information

points to uneven developments in countries’

adherence to the agreed fi scal consolidation

plans. There is a risk that, in some countries, fi scal

balances may fall behind the targets agreed by the

ECOFIN Council for the necessary and timely

correction of excessive defi cits. It is essential

that all governments meet the fi scal balance

targets for 2011 that they have announced.

Where necessary, additional corrective

measures must be implemented swiftly to ensure

progress in achieving fi scal sustainability. The

implementation of credible policies is crucial in

view of ongoing fi nancial market pressures.

At the same time, it is of the utmost importance

that substantial and far-reaching structural

reforms be implemented urgently in the

euro area in order to strengthen its growth

potential, competitiveness and fl exibility. In

particular, countries which have high fi scal

and external defi cits or which are suffering

from a loss of competitiveness should embark

on comprehensive economic reforms. In the

case of product markets, policies that enhance

competition and innovation should, in particular,

be further pursued to speed up restructuring and

to bring about improvements in productivity.

Regarding the labour market, the priority must

be to enhance wage fl exibility and incentives to

work, and to remove labour market rigidities.

The Governing Council, in line with the

ECB’s opinion of 17 February 2011 on the six

legislative proposals on economic governance,

urges the ECOFIN Council, the European

Parliament and the European Commission to

agree, in the context of their “trialogue”, on

more stringent requirements, more automaticity

in the procedures and a clearer focus on the

most vulnerable countries with losses in

competitiveness.

Finally, the Governing Council welcomes the

economic and fi nancial adjustment programme

which was agreed by the Portuguese government

following the successful conclusion of the

negotiations with the European Commission,

in liaison with the ECB and the International

Monetary Fund. The programme contains the

necessary elements to bring about a sustainable

stabilisation of the Portuguese economy.

It addresses in a decisive manner the economic

and fi nancial causes underlying current market

concerns and will thereby contribute to restoring

confi dence and safeguarding fi nancial stability in

the euro area. The Governing Council welcomes

the commitment of the Portuguese public

authorities to take all the necessary measures

to achieve the objectives of the programme.

It considers very important the broad political

support for the adjustment programme,

which enhances the overall credibility of the

programme.

This issue of the Monthly Bulletin contains

two articles. The fi rst describes the patterns of

euro area and US macroeconomic cycles and

provides some refl ections on the recovery.

The second reviews and assesses the rationale

and current arrangements for the external

representation of the EU and EMU.

9ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

The external

environment

of the euro area

ECONOMIC AND MONETARY DEVELOPMENTS

1 THE EXTERNAL ENVIRONMENT OF THE EURO AREA

Global economic activity is continuing to expand at a robust pace, notwithstanding the recent decline in survey indicators, which suggests some moderation in the growth momentum. Differences with respect to the cyclical position across regions also persist, with buoyant growth and overheating pressures in emerging economies and restrained growth in advanced economies. Global infl ationary pressures have increased further, mainly on account of rising commodity prices. Price pressures are clearly more pronounced in emerging economies, as abundant liquidity amid low interest rates and capacity constraints add to domestic wage and commodity price pressures.

1.1 DEVELOPMENTS IN THE WORLD ECONOMY

Global economic activity is continuing to expand at a robust pace, notwithstanding the decline in

the latest survey indicators, which suggests some moderation in the growth momentum. In April

the global manufacturing Purchasing Managers’ Index (PMI) for output continued to weaken to

54.7, following its rather sharp decline to 56.8 in March from 59.1 in the previous month. However,

the April level is still above its average value since January 1999, suggesting that the overall pace

of global activity remains strong. The decline in the global PMI was largely affected by the sharp

drop in the PMI for Japan in the aftermath of the Great East Japan Earthquake, as well as by a

moderation in the US PMI from its seven-year peak in February. However, the medium-term global

repercussions of the events in Japan should remain rather limited provided major disruptions in

global supply chains remain contained (see Box 1).

Differences with respect to the cyclical position and the strength of the growth momentum across

regions also persist. Emerging economies are recording buoyant growth and operating at close to

full capacity. Many of these countries are increasingly being confronted with overheating pressures,

notwithstanding their efforts to restrain growth by engaging in more restrictive monetary and fi scal

policies. This contrasts with the situation in many advanced economies, where the need for further

Chart 1 Global PMI output

(diffusion index; seasonally adjusted; monthly data)

25

30

35

40

45

50

55

60

65

25

30

35

40

45

50

55

60

65

2000 2002 2004 2006 2008 2010

PMI output: overall

PMI output: manufacturing

PMI output: services

Source: Markit.

Chart 2 International price developments

(monthly data; annual percentage changes)

-1

0

1

2

3

4

5

6

-1

0

1

2

3

4

5

6

2000 2002 2004 2006 2008 2010

OECD consumer prices (all items)

OECD consumer prices (all items excluding food

and energy)

Source: OECD.

10ECB

Monthly Bulletin

May 2011

private sector balance sheet repair combined with persistently weak labour market conditions

continues to restrain the recovery. In the OECD area, unemployment has been declining only

gradually in recent months and stood at 8.2% in February 2011. This was the fourth consecutive

monthly decrease, following a period of stability at around 8.5% throughout most of 2010.

Global infl ationary pressures have increased further (in the short run), mainly on account of rising

commodity prices feeding through the supply chain. In April the PMI for global manufacturing

input prices declined somewhat compared with the fi gures recorded in previous months, but

remained high at 72.4, signalling a further marked increase in average input prices. This is in line

with rising consumer price infl ation in the OECD area, which reached 2.7% in the year to March.

Recent increases were mainly driven by surging commodity prices. Excluding food and energy,

infl ation in the OECD area in March increased by 0.1 percentage point compared with the previous

month to 1.4%. Price pressures are clearly more pronounced in emerging economies, as abundant

liquidity amid low interest rates and capacity constraints add to domestic wage and global

commodity price pressures.

Box 1

GLOBAL ECONOMIC REPERCUSSIONS OF THE EARTHQUAKE IN JAPAN

The Great East Japan Earthquake and the ensuing tsunami constitute an immense human tragedy

with more than 25,000 people either missing or dead and many more residing in emergency

shelters. The physical destruction is also extensive, as houses, plants and infrastructure have been

damaged. A recent estimate by the Japanese government places the total amount of damages at

between JPY 16 trillion and JPY 25 trillion, corresponding to 3.3% and 5.2% of GDP in 2010

respectively. This is well above that of the Kobe earthquake in 1995, where the economic costs

amounted to about 2% of GDP.

Past experience suggests that the economic disruption in the aftermath of a natural disaster is

commonly short-lived and followed by a rather quick reconstruction-fuelled rebound. In the

case of the Kobe earthquake, for instance, the ensuing decline in economic activity was fully

recovered within a few months, as damaged plants and equipment had to be restored and

manufacturing capacities were transferred to other regions. Consistent with this pattern, most

market observers currently expect a strong short-term contraction in economic activity in Japan.

Accordingly, projections for Japanese economic growth have been revised downwards for 2011,

but the outlook has been revised upwards for 2012. For instance, the IMF, in its April 2011

World Economic Outlook (WEO), revised the growth projections for Japan downwards to 1.4%

in 2011 (from 1.6% in the January WEO update) and upwards to 2.1% in 2012 (from 1.8%).

The OECD expects a sharper economic slowdown in 2011, projecting real GDP growth

to slow to 0.8% in 2011 (compared with 1.7% in the OECD Economic Outlook released in

November 2010), before picking up to 2.3% in 2012 (compared with 1.3%).

The negative impact on activity of the recent earthquake is signifi cantly greater than in 1995 and

further compounded by the nuclear crisis and power shortages. Production at several plants has

been suspended or curtailed because of physical damage, supply-chain disruptions within Japan

and, temporarily, rolling electricity outages in view of power supply shortages. The associated

pronounced decline in economic activity has been refl ected in the manufacturing output PMI,

11ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

The external

environment

of the euro area

which has fallen well below the expansion/contraction threshold of 50 since the earthquake

(see Chart A). In April 2011 it stood at 35.0, following its sharp drop to 37.7 in March from 53.0

in February. The deterioration in business sentiment has been further confi rmed by the Reuters

Tankan survey. Correspondingly, in March Japan’s industrial production plummeted by 15.3%

compared with the previous month. Consumer confi dence has also been dented, partly in view

of the prevailing uncertainty associated with the prospective resolution of the situation at the

Fukushima nuclear plant.

The international repercussions of the events in Japan through trade linkages are likely to be

relatively contained. Although Japan is an important global player, its economy is rather closed,

accounting for around 4.5% of global imports. Emerging Asia – given its regional proximity –

is most exposed to developments in Japan. On average, about 8% of these countries’ exports

go to Japan. Japan’s trade linkages with the Middle East and North Africa as well as Australia

are even stronger, but a large proportion of this trade is in commodities. The exposure of the

United States to Japan is much lower at just over 5% of its exports, and it is even lower for the

euro area, as only about 2.5% of extra-euro area exports are sent to Japan (see Chart B). On the

import side, the euro area depends heavily on Japanese products for specifi c chemicals, car parts,

photographic components and machinery. With regard to the global fi nancial repercussions of

the events in Japan, these have also been rather contained, as the Japanese economy is also

relatively closed from a fi nancial perspective, compared with other advanced economies.

For instance, foreign investment in Japan amounts to only about 60% of GDP in Japan, compared

with 140% of GDP in the United States and 175% of GDP in the euro area.

Chart B Global trade exposure to Japan (measured by Japan’s share in the respective country’s total exports)

(percentage of GDP; average 2005-09)

0

4

8

12

16

20

24

0

4

8

12

16

20

24

1

Australia 1

Middle East and North Africa2

Asia (excluding Japan)3

United States4

Canada6

euro area5

United Kingdom7

2 3 4 5 6 7

Sources: UN (Comtrade), IMF (WEO) and ECB staff.Note: The geographical aggregates are GDP-weighted. The euro area aggregate refers to extra-euro area trade.

Chart A Manufacturing output PMI and Reuters Tankan

(diffusion index; seasonally adjusted; monthly data)

10

20

30

40

50

60

70

-105

-90

-75

-60

-45

-30

-15

0

15

30

45

2008 2009 2010

PMI Japan (left-hand scale)

PMI global (left-hand scale)

Tankan large manufacturers (right-hand scale)

Sources: Markit, Reuters.Note: Last observation refers to April 2011.

12ECB

Monthly Bulletin

May 2011

UNITED STATES

In the United States, the economy is continuing its recovery, and real GDP further expanded in the

fi rst quarter of 2011, albeit at a slower pace than in the fourth quarter of 2010. According to the

advance estimate by the Bureau of Economic Analysis, real GDP increased by 1.8% in annualised

terms in the fi rst quarter of 2011, decreasing from 3.1% in the last quarter of 2010. The slowdown

compared with the previous quarter largely refl ected softer growth in personal consumption

expenditure, a decline in structures investment and a sharper decrease in government spending.

Moreover, an upturn in imports and a deceleration in export growth led to a negative net trade

contribution in the fi rst quarter of 2011. Real GDP growth, however, was supported by a signifi cant

positive contribution from inventory accumulation. The slowdown in real GDP growth is expected

to be transitory, and the recovery is expected to proceed, albeit at a less robust pace compared

with other recovery episodes (see the article entitled “Patterns of euro area and US macroeconomic

cycles – what has been different this time?” in this issue of the Monthly Bulletin).

These direct trade effects could, however, be amplifi ed by possible disruptions in global supply

chains. Amid the rapid progress in globalisation in past decades, vertical specialisation has led

to complex global production networks, which means that missing individual components could

disrupt entire production processes in major industries. In fact, in certain product categories,

a large proportion of global production by a number of the world’s leading fi rms is located

in the area affected by the earthquake and the scale of the damage requires, in some cases,

rather prolonged production shutdowns. Anecdotal evidence suggests that this mainly affects

the production of crucial components for the global automotive and electronics industries.

In the short term most global manufacturers can draw on their inventories to defer and mitigate

the effects of such supply-chain bottlenecks. Even in a world of just-in-time production, fi rms

normally hold suffi cient inventories to cover a few weeks or even months. While sourcing the

missing products from an alternative supplier or relocating production to another unaffected

plant can take several months – as quality testing and logistics need to be ensured – such

alternative sources of supply should eventually become operational, suggesting that possible

supply-chain impediments should be only temporary. Moreover, key transport infrastructure has

been restored, and there are reports that several factories affected by the earthquake in Japan

have already resumed or are preparing to resume production.

The Japanese situation could also have spillover effects on global commodity prices as Japan is a

major importer. In the near term the disruptions in the industrial sector and damage to refi neries

as a result of the earthquake may lower demand for commodities. In the medium run, however,

the economic reconstruction in Japan is likely to increase demand for energy and base metals,

potentially putting some upside pressure on the prices of these commodities. Such pressures

may be compounded if Japan (and other countries) rethink their nuclear strategy, which could

trigger a more broad-based change in the structure of energy demand in the medium term.

All in all, it remains extremely diffi cult to assess the repercussions of the earthquake in Japan.

In the short term the economic outlook for Japan has deteriorated sharply and supply-chain

challenges – both domestically and globally – are a concern for some companies. Looking

further ahead, however, potential supply-chain bottlenecks should be resolved over time and

the reconstruction-based recovery is likely to support economic activity in Japan. Nevertheless,

the recent events may have wider long-term implications as global energy strategies, inventory

policies and supply-chain connections may be reconsidered.

13ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

The external

environment

of the euro area

As regards price developments, annual CPI infl ation picked up from 2.2% in February to 2.7% in

March. The increase stemmed from a continued marked annual rise in energy prices (15.5%) and,

to a lesser extent, in food prices (2.9%). Excluding food and energy, annual infl ation increased to

1.2% in March from 1.1% in February, suggesting that the pass-through of costs is gaining strength

as the economic recovery continues.

On 27 April 2011 the US Federal Open Market Committee (FOMC) decided to maintain its target

range for the federal funds rate at between 0.0% and 0.25%. As mentioned in the inaugural post-

FOMC meeting press conference, the FOMC continues to anticipate that economic conditions,

including low rates of resource utilisation, subdued infl ation trends and stable infl ation expectations,

are likely to warrant exceptionally low levels for the federal funds rate for an extended period.

JAPAN

Short-term indicators show a substantial deceleration in the Japanese economy in the immediate

aftermath of the Great East Japan Earthquake. Industrial production declined by 15.3% month

on month in March, and hence much more than after the Kobe earthquake (-2.6% month on

month in January 1995). Moreover, business and consumer sentiment have been deteriorating.

The Reuters Tankan survey showed that corporate confi dence fell by a record amount in April

and is expected to worsen further. At the same time, some progress has been made in rebuilding

infrastructure and restoring production. Global repercussions remain diffi cult to assess, with

supply-chain challenges being a concern for some companies. Annual CPI infl ation was zero in

March for a fourth consecutive month, refl ecting weak demand. Annual CPI infl ation excluding fresh

food stood at -0.1%, whereas annual CPI infl ation excluding fresh food and energy stood at -0.7%.

On 28 April 2011 the Bank of Japan decided to leave its target for the uncollateralised overnight

rate unchanged at between 0.0% and 0.1%. Also, in addition to the emergency measures announced

in March, on 7 April 2011 the Bank of Japan decided to introduce a funds-supplying operation that

provides fi nancial institutions in disaster areas with longer-term funds and to broaden the range of

eligible collateral for money market operations with a view to securing suffi cient fi nancing capacity

for fi nancial institutions in the disaster area.

UNITED KINGDOM

In the United Kingdom, economic activity recovered in the fi rst quarter of 2011. According to

preliminary estimates, real GDP increased by 0.5% quarter on quarter in the fi rst quarter of 2011

after declining by 0.5% in the fourth quarter of 2010 and increasing by 0.7% in the quarter prior

to that (see Chart 3). The expansion of output over the fi rst quarter was driven by the services

and manufacturing sectors, while construction output continued to decline. House prices have

continued on a downward path in recent months against the background of subdued demand in the

housing market. Looking ahead, inventory adjustments, monetary stimulus, external demand and

the recent depreciation of the pound sterling should support economic activity. However, growth in

domestic demand is expected to remain constrained by tight credit conditions, household balance

sheet adjustment and substantial fi scal tightening.

Annual CPI infl ation has remained elevated in recent months, decreasing to 4.0% in March 2011,

from 4.4% in February, mainly refl ecting the lagged effects of the depreciation of the pound

sterling, higher commodity prices and the increase in the rate of VAT in January 2011. Looking

ahead, these factors are likely to continue to exert upward pressure on annual CPI infl ation.

In recent months the Bank of England’s Monetary Policy Committee has maintained the offi cial

Bank Rate paid on commercial bank reserves at 0.5%.

14ECB

Monthly Bulletin

May 2011

CHINA

In China, real GDP increased by 9.7% year on year in the fi rst quarter of 2011, down from 9.8%

in the previous quarter, signalling the economy’s resilience despite continued policy tightening.

Investment and consumption were the main sources of GDP growth in the fi rst quarter of 2011.

Conversely, the contribution of net exports to growth turned negative, mainly owing to robust

domestic demand.

In March annual CPI infl ation increased to 5.4%, from 4.9% in February, mainly driven by food

prices. High commodity prices and ongoing abundant domestic liquidity are also expected to

keep infl ationary pressures high, at least during the fi rst half of 2011. Property market data on

prices and construction volumes show some signs of a slowdown in response to the tightening

measures. Amid sustained infl ationary pressures and a further acceleration in new lending and

M2 growth, the People’s Bank of China continued to tighten its monetary policy stance in April.

The one-year reference deposit and lending rates were raised by 25 basis points. The reserve

requirement ratio was also increased by 50 basis points to neutralise the steady increase in domestic

liquidity resulting from strong capital fl ows. The stock of offi cial foreign reserves went above the

USD 3 trillion threshold at the end of the fi rst quarter.

1.2 COMMODITY MARKETS

Oil prices continued to increase in April. Brent crude oil prices stood at USD 123.8 per barrel on

4 May 2011, which is 32.8% higher than at the beginning of the year (see Chart 4). Looking ahead,

market participants expect slightly lower oil prices in the medium term, with futures contracts for

December 2012 trading at around USD 114.2 per barrel.

Demand has been growing robustly in the last few months, both in emerging and developed

economies. Coupled with the supply-side disruptions generated by the upheaval in Libya, this has

Chart 3 Main developments in major industrialised economies

euro area United States

Japan United Kingdom

Output growth 1)

(quarter-on-quarter percentage changes; quarterly data)

Inflation rates 2)

(consumer prices; annual percentage changes; monthly data)

-5

-6

-4

-3

-2

-1

0

1

2

3

-5

-6

-4

-3

-2

-1

0

1

2

3

2000 2002 2004 2006 2008 2010-3

-2

-1

0

1

2

3

4

5

6

-3

-2

-1

0

1

2

3

4

5

6

2000 2002 2004 2006 2008 2010

Sources: National data, BIS, Eurostat and ECB calculations.1) Eurostat data are used for the euro area and the United Kingdom; national data are used for the United States and Japan. GDP fi gures have been seasonally adjusted.2) HICP for the euro area and the United Kingdom; CPI for the United States and Japan.

15ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

The external

environment

of the euro area

led to a substantial drawdown on inventories.

Some signs of a slowdown in the pace of demand

growth, possibly as a consequence of high

prices, are now starting to materialise. However,

any further supply disruptions are likely to put

additional upward pressure on prices.

The prices of non-energy commodities increased

slightly in April. Food prices remained stable

in response to mixed news about the status of

planting in the United States. Metal prices instead

posted some gains, driven in particular by nickel

and aluminium. In aggregate terms, the price

index for non-energy commodities (denominated

in US dollars) was 6.2% higher at the end of

April than at the beginning of the year.

1.3 EXCHANGE RATES

In April and early May the nominal effective

exchange rate of the euro, as measured against

the currencies of 20 of the euro area’s most important trading partners, continued the appreciation

that started in January 2011. As a result, on 4 May 2011 the nominal effective exchange rate of the

euro was 4.3% higher than at the end of January 2011 and 3.7% above its average level for 2010

(see Chart 5).

Chart 4 Main developments in commodity prices

30

40

50

60

70

80

90

100

110

120

130

140

150

160

170

180

60

65

70

75

80

85

90

95

100

105

110

115

120

125

130

135

2008

Brent crude oil (USD/barrel; left-hand scale)non-energy commodities (USD; index: 2010 = 100;

right-hand scale)

20102009

Sources: Bloomberg and HWWI.

Chart 5 Euro effective exchange rate (EER-20) and its decomposition1)

(daily data)

Index: Q1 1999 = 100Contributions to EER-20 changes 2) From 31 January 2011 to 4 May 2011 (percentage points)

100

101

102

103

104

105

106

107

108

109

100

101

102

103

104

105

106

107

108

109

January2011

February March April-1

0

1

2

3

4

5

-1

0

1

2

3

4

5

USD GBP JPY CNY CHF SEK OMS Other EER

-20

Source: ECB.1) An upward movement of the index represents an appreciation of the euro against the currencies of 20 of the most important trading partners of the euro area (including all non-euro area EU Member States).2) Contributions to EER-20 changes are displayed individually for the currencies of the six main trading partners of the euro area. The category “Other Member States” (OMS) refers to the aggregate contribution of the currencies of the non-euro area EU Member States (except the pound sterling and the Swedish krona). The category “Other” refers to the aggregate contribution of the currencies of the remaining six trading partners of the euro area in the EER-20 index. Changes are calculated using the corresponding overall trade weights in the EER-20 index.

16ECB

Monthly Bulletin

May 2011

In bilateral terms, in the past three months the euro appreciated against most major currencies.

Between 31 January 2011 and 4 May 2011, it strengthened against the Japanese yen (by 7.2%),

the US dollar (by 8.7%) and the pound sterling (by 4.5%). The single currency also appreciated

signifi cantly vis-à-vis the major Asian currencies as well as the Canadian dollar (see Table 1).

The appreciation of the euro against the US dollar, combined with the corresponding strengthening

against the currencies tied to the US dollar, accounted for about 65% of the overall appreciation

in effective terms (see Chart 5). Foreign exchange markets experienced a bout of high volatility

following the Japanese earthquake in March, but volatility reverted to values closer to, or below,

historical averages in early April. Volatility, as measured on the basis of foreign exchange option

prices, increased again in the course of April and early May.

Between 31 January 2011 and 4 May 2011, the currencies participating in ERM II remained broadly

stable against the euro, trading at, or close to, their respective central rates. The Latvian lats, after

having remained for many months on the weak side of the unilaterally set fl uctuation band of +/-1%,

also moved closer to the central rate in January and early February. Since mid-February, however,

it has progressively moved back towards the weak side of the band.

1.4 OUTLOOK FOR THE EXTERNAL ENVIRONMENT

Looking ahead, notwithstanding the latest moderation in the growth momentum, the global

economic prospects are expected to remain favourable, and the recovery is becoming

increasingly self-sustained. This is in line with the latest OECD composite leading indicator for

February 2011, which continues to point to expansion in most OECD countries. The positive

outlook for global economic activity is also supported by a continued sustained reading in the

global PMI component for new orders. The tragic events in Japan and tensions in the Middle

East and North Africa have added to the uncertainty surrounding the global outlook, but they are

Table 1 Euro exchange rate developments 1)

(daily data; units of national currency per euro; percentage changes)

Appreciation (+)/Depreciation(-) of the euro as at 4 May 2011Level on since: compared with:

Weight in EER-20 4 May 2011 31 January 2011 1 January 2010 average for 2010

US dollar 19.4 1.49 8.7 3.4 12.3

Pound sterling 17.8 0.900 4.5 1.0 4.9

Chinese renminbi 13.6 9.66 7.0 -1.6 7.7

Japanese yen 8.3 120.6 7.2 -9.7 3.8

Swiss franc 6.4 1.28 -0.5 -13.8 -7.1

Polish zloty 4.9 3.94 0.0 -4.1 -1.5

Swedish krona 4.9 9.01 1.6 -11.6 -5.5

Czech koruna 4.1 24.21 -0.1 -7.9 -4.3

Korean won 3.9 1,596.48 4.1 -4.0 4.2

Hungarian forint 3.1 264.68 -3.3 -1.9 -3.9

NEER 2) 108.5 4.3 -3.0 3.7

Source: ECB. 1) Bilateral exchange rates in descending order based on the corresponding currencies’ trade weights in the EER-20 index. 2) Euro nominal effective exchange rate against the currencies of 20 of the most important trading partners of the euro area (EER-20).

17ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

The external

environment

of the euro area

unlikely to derail the global recovery process.

As regards Japan, it is widely expected that the

disruption of economic activity will be rather

short-lived and followed by a relatively quick,

reconstruction-fuelled rebound.

The risks to global activity remain broadly

balanced in an environment of elevated

uncertainty. On the one hand, global trade may

continue to grow more rapidly than expected.

On the other hand, downside risks relate to

the ongoing tensions in some segments of the

fi nancial markets, further increases in energy

prices, in particular in view of ongoing

geopolitical tensions, protectionist pressures

and the possibility of a disorderly correction

of global imbalances. Finally, there are

potential risks stemming from the economic

impact of the recent natural and nuclear

disaster in Japan.

Chart 6 OECD composite leading indicators

(monthly data; amplitude-adjusted)

90

92

94

96

98

100

102

104

106

90

92

94

96

98

100

102

104

106

OECD

emerging markets

2000 2002 2004 2006 2008 2010

Source: OECD.Note: The emerging market indicator is a weighted average of the composite leading indicators for Brazil, Russia and China.

18ECB

Monthly Bulletin

May 2011

2 MONETARY AND FINANCIAL DEVELOPMENTS

2.1 MONEY AND MFI CREDIT

The annual growth rate of M3 increased in March 2011, while that of MFI loans to the private sector remained broadly unchanged. Annual growth in both loans to households and loans to non-fi nancial corporations remained slow. Overall, looking beyond short-term developments, the latest monetary data continue to point to a gradual recovery in euro area money and loan growth. The assessment that the underlying pace of monetary expansion is currently moderate still holds. However, monetary liquidity remains ample and may facilitate the accommodation of price pressures. Finally, MFIs’ main assets decreased in March, following signifi cant increases in the previous two months.

THE BROAD MONETARY AGGREGATE M3

The annual growth rate of M3 increased further to stand at 2.3% in March, up from 2.1% in

February (see Chart 7). This increase resulted from a strong monthly infl ow for M3 in the month

under review, despite the negative impact of transactions with central counterparties (CCPs).

The monthly infl ow was, to a large extent, driven by a signifi cant monthly infl ow for overnight

deposits and debt securities with a maturity of up to two years. Looking beyond the short-term

volatility characterising monthly fl ows, the latest data point to a continued gradual recovery in

annual M3 growth. At the same time, annual growth in broad money remains weak by historical

standards.

To a large extent, developments in M3 and its main components over the past few months continue

to refl ect the interest rate constellation. Since November 2010 the steepness of the yield curve has

gradually increased, implying that the monetary assets included in M3 have lost some of their

attractiveness relative to more highly remunerated longer-term assets outside M3. At the same time,

the gradual increase observed since the second

half of 2009 in the positive spread between the

interest rates paid on short-term time deposits

and those paid on overnight deposits has led

to a steady narrowing of the gap between the

annual growth rate of M1 and the annual growth

rate of short-term deposits other than overnight

deposits (i.e. M2 minus M1).

On the counterpart side, the annual growth rate

of loans to the private sector decreased slightly

in March, concealing two distinct developments.

On the one hand, there were increases in the

annual growth rates of loans to non-fi nancial

corporations and households, while on the

other hand, the annual growth rate of loans to

non-monetary fi nancial intermediaries other

than insurance corporations and pension funds

(OFIs) decreased, mainly owing to a monthly

outfl ow for loans to CCPs. Although adjusting

for the derecognition of loans implies that the

decline in the growth of loans to the private

Chart 7 M3 growth

(percentage changes; adjusted for seasonal and calendar effects)

-2

0

2

4

6

8

10

12

14

-2

0

2

4

6

8

10

12

14

1999 2001 2003 2005 2007 2009

M3 (annual growth rate)M3 (three-month centred moving average

of the annual growth rate)M3 (six-month annualised growth rate)

Source: ECB.

19ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Monetary and

financial

developments

sector was more marked in March, the broader picture of gradually recovering loan growth in the

fi rst quarter of 2011 remains.

The main assets held by euro area MFIs declined in March, mainly refl ecting a reduction in inter-MFI

lending and holdings of government securities. Looking at the whole of the fi rst quarter, however,

MFIs’ main assets increased further, suggesting that the monthly decline in March should not be

overemphasised.

MAIN COMPONENTS OF M3

The annual growth rates of M1 and marketable instruments remained broadly unchanged in March,

while that of other short-term deposits continued to strengthen. This development partly refl ects the

gradual increase in the remuneration of other short-term deposits over recent months.

The annual growth rate of M1 increased marginally to stand at 3.0% in March, up from 2.9% in

February. Although this increase was only marginal, overnight deposits registered strong dynamics.

In particular, after a signifi cant outfl ow in January and a very weak infl ow in February, overnight

deposits saw a strong infl ow in March which was broadly based across sectors (on a seasonally

unadjusted basis). Given the volatility of these fl ows, monthly developments should not be

overemphasised.

The annual growth rate of short-term deposits other than overnight deposits increased signifi cantly

to stand at 2.2% in March, up from 1.8% in the previous month. This increase conceals the fact that

the monthly infl ow for these deposits changed only marginally and remained weak in March, as in

February. This small but positive monthly fl ow probably refl ects the gradual nature of the increase

in the rate of interest on these deposits. The current and expected future interest rate constellations

suggest that these positive fl ows are likely to continue in the short term, at the expense of overnight

deposits.

At the same time, divergent developments were observed in the two sub-components: the annual

growth rate of short-term savings deposits (i.e. deposits redeemable at notice of up to three months)

continued to decline somewhat, while remaining signifi cantly positive, and that of short-term time

deposits (i.e. deposits with an agreed maturity of up to two years) strengthened further, while

remaining modestly negative, refl ecting the increasing remuneration of short-term time deposits

relative to short-term savings deposits over the past few months.

The annual growth rate of marketable instruments (i.e. M3 minus M2) remained broadly unchanged

at -0.2% in March, although the monthly infl ow declined signifi cantly compared with February.

This was largely due to a strong outfl ow for repurchase agreements, mostly related to secured

interbank lending activity conducted via CCPs, after an even stronger infl ow in the previous month.

This was only partially offset by an increase in net sales of short-term MFI debt securities to the

money-holding sector, while developments in money market fund shares/units remained muted

in March.

The annual growth rate of M3 deposits – which comprise short-term deposits and repurchase

agreements and represent the broadest monetary aggregate for which a timely sectoral breakdown

is available – remained broadly unchanged in March. This refl ected a slight increase in the annual

growth rate of M3 deposits held by households, which was broadly offset by a slight decrease in the

annual growth rate of M3 deposits held by non-fi nancial corporations. In terms of monthly fl ows,

20ECB

Monthly Bulletin

May 2011

M3 deposits recorded a signifi cant outfl ow in March, driven by a large outfl ow for repurchase

agreements with CCPs, as indicated above. This was only partially offset by infl ows for M3 deposits

held by households and non-fi nancial corporations.

MAIN COUNTERPARTS OF M3

As regards the counterparts of M3, the annual growth rate of MFI credit to euro area residents

declined to 3.2% in March, down from 3.8% in February (see Table 2). This refl ected weaker

growth in credit to general government, while growth in credit to the private sector remained

broadly unchanged.

Within credit to general government, both the annual growth rate of loans granted by MFIs and

that of securities (other than shares) purchased by MFIs decreased in March. Both growth rates

remained at a high level, refl ecting the impact of the fi nancing of asset transfers to “bad bank”

schemes, which will remain visible in these growth rates until September 2011.

The annual growth rate of credit to the euro area private sector remained broadly unchanged

at 2.2% in March, having stood at 2.3% in the previous month, despite the unwinding of the strong

infl ow observed in February for loans to OFIs as a result of interbank repo transactions conducted

via CCPs. Furthermore, developments in credit to the private sector were affected in March by a

large transaction refl ecting the unwinding of a previous securitisation operation, which resulted in:

(i) a signifi cant reduction in holdings of securities issued by OFIs; and (ii) the re-recognition of the

loans on the relevant MFI’s balance sheet in loans for house purchase.

Table 2 Summary table of monetary variables

(quarterly fi gures are averages; adjusted for seasonal and calendar effects)

Outstandingamount as a

percentage of M3 1)

Annual growth rates2010

Q22010

Q32010

Q42011

Q12011Feb.

2011Mar.

M1 49.1 10.3 7.8 4.9 3.2 2.9 3.0Currency in circulation 8.4 6.4 6.5 5.6 4.9 5.1 3.7

Overnight deposits 40.7 11.2 8.1 4.8 2.9 2.4 2.8

M2 - M1 (= other short-term deposits) 38.9 -8.0 -5.1 -1.1 1.3 1.8 2.2

Deposits with an agreed maturity

of up to two years 18.9 -21.4 -16.2 -8.8 -2.8 -1.6 -0.3

Deposits redeemable at notice

of up to three months 20.0 10.3 8.4 7.3 5.4 5.2 4.8

M2 88.1 1.5 1.7 2.2 2.4 2.4 2.6M3 - M2 (= marketable instruments) 11.9 -9.7 -6.5 -3.0 -1.8 -0.3 -0.2

M3 100.0 -0.1 0.7 1.5 1.9 2.1 2.3

Credit to euro area residents 1.8 2.0 3.3 3.6 3.8 3.2Credit to general government 9.0 7.5 11.5 10.6 10.5 7.7

Loans to general government 6.7 6.5 15.4 17.8 17.8 14.2

Credit to the private sector 0.2 0.8 1.5 2.1 2.3 2.2

Loans to the private sector 0.2 0.9 1.7 2.4 2.6 2.5

Loans to the private sector adjusted for

sales and securitisation 0.1 1.0 1.9 2.8 3.0 2.8

Longer-term fi nancial liabilities (excluding capital and reserves) 4.4 2.6 2.7 2.8 3.0 2.9

Source: ECB.1) As at the end of the last month available. Figures may not add up due to rounding.

21ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Monetary and

financial

developments

The annual growth rate of loans to non-fi nancial corporations continued to strengthen, standing at

0.8% in March, up from 0.6% in February. The monthly fl ow was marginally positive as a result of

net lending at maturities of over fi ve years. At the same time, cross-country heterogeneity in loan

developments remained signifi cant, in line with the uneven recovery in economic activity and the

differences currently observed in the external fi nancing needs of individual industrial sectors in the

various countries of the euro area.

The annual growth rate of loans to households increased to 3.4% in March, up from 3.0% in the

previous month. This increase mainly resulted from the unwinding of a previous securitisation

transaction, for which the collateral consisted of loans for house purchase, which contributed

€20 billion to the infl ow in March. After adjusting for this development, the fl ow of loans to

households is still markedly positive, while the annual growth rate remains unchanged compared

with February. The outfl ow for consumer credit stagnated during the month and increased in annual

terms. This weakness is likely to be related to a lack of willingness to embark upon purchases of

“big-ticket” items as a result of continued muted growth in disposable income and high levels of

household indebtedness. Overall, therefore, the March data tend to confi rm the earlier signs that the

recovery in loans to households has levelled off in recent months.

For details of developments in both demand for loans on the part of euro area fi rms and households

and the credit standards of banks, see the box entitled “The results of the April 2011 bank lending

survey for the euro area”. A broader analysis of savings, investment and fi nancing broken down

by institutional sector is presented in the box entitled “Integrated euro area accounts for the fourth

quarter of 2010” in Section 2.6.

Among the other counterparts of M3, the annual growth rate of MFI longer-term fi nancial

liabilities (excluding capital and reserves) remained broadly unchanged at 2.9% in March. This

development conceals diverging growth levels across the main instruments. On the one hand,

the annual growth rate of longer-term MFI debt securities declined to 2.6% in March, down

from 3.0% in February, and thus remains low, despite substantial monthly infl ows in the fi rst

Table 3 MFI loans to the private sector

(quarterly fi gures are averages; adjusted for seasonal and calendar effects)

Outstanding amount as a percentage

of the total 1)

Annual growth rates2010

Q2 2010

Q3 2010

Q4 2011

Q1 2011 Feb.

2011 Mar.

Non-fi nancial corporations 42.3 -2.2 -1.3 -0.4 0.5 0.6 0.8 Up to one year 24.4 -10.8 -8.3 -5.0 -1.5 -1.0 -0.4

Over one and up to fi ve years 19.0 -4.6 -3.4 -2.1 -2.0 -1.8 -1.8

Over fi ve years 56.6 3.1 2.9 2.5 2.2 2.2 2.3

Households 2) 46.9 2.6 2.8 2.8 3.1 3.0 3.4 Consumer credit 3) 12.1 -0.5 -0.5 -0.7 -0.8 -0.7 -0.9

Lending for house purchase 3) 72.1 3.0 3.4 3.5 3.9 3.8 4.4

Other lending 15.8 3.2 2.9 2.5 2.6 2.6 2.1

Insurance corporations and pension funds 0.8 -9.1 -1.1 7.6 7.5 8.6 5.6 Other non-monetary fi nancial intermediaries 10.0 0.8 2.4 4.6 7.0 8.7 5.7

Source: ECB.Notes: MFI sector including the Eurosystem; sectoral classifi cation based on the ESA 95. For further details, see the relevant technical notes.1) As at the end of the last month available. Sector loans as a percentage of total MFI loans to the private sector; maturity breakdown and breakdown by purpose as a percentage of MFI loans to the respective sector. Figures may not add up due to rounding.2) As defi ned in the ESA 95.3) The defi nitions of consumer credit and lending for house purchase are not fully consistent across the euro area.

22ECB

Monthly Bulletin

May 2011

two months of 2011. On the other hand, the

annual growth rate of deposits with an agreed

maturity of over two years increased to 3.9%,

up from 3.6% in February. In recent months

insurance corporations and pension funds have

contributed to the dampening of this growth

rate, while other sectors have placed additional

funds in this instrument.

An annual infl ow of €80 billion was recorded

in March for MFIs’ net external asset position,

compared with an outfl ow of €46 billion

in the previous month (see Chart 8). This

development refl ects a small increase in the

annual infl ow for MFI loans to non-residents

and a signifi cant decline in the annual outfl ow

for MFIs’ external liabilities. The decline

in external liabilities resulted mostly from a

reduction in deposits held with euro area MFIs

by non-residents.

Overall, looking beyond short-term

developments, the latest monetary data continue

to point to a gradual recovery in euro area

money and loan growth. The assessment that

underlying monetary expansion is currently

moderate still holds. However, monetary

liquidity remains ample and may facilitate the

accommodation of price pressures.

Chart 8 Counterparts of M3

(annual fl ows; EUR billions; adjusted for seasonal and calendar effects)

-800

-600

-400

-200

0

200

400

600

800

1,000

1,200

1,400

1,600

-800

-600

-400

-200

0

200

400

600

800

1,000

1,200

1,400

1,600

credit to the private sector (1)

credit to general government (2)

net external assets (3)

longer-term financial liabilities

(excluding capital and reserves) (4)

other counterparts (including capital and reserves) (5)

M3

2007 2008 20102009

Source: ECB.Notes: M3 is shown for reference only (M3 = 1+2+3-4+5). Longer-term fi nancial liabilities (excluding capital and reserves) are shown with an inverted sign, since they are liabilities of the MFI sector.

Box 2

THE RESULTS OF THE APRIL 2011 BANK LENDING SURVEY FOR THE EURO AREA

This box describes the main results of the April 2011 bank lending survey for the euro area,

which was conducted by the Eurosystem between 14 and 31 March 2011.1 Overall, euro area

banks slightly tightened their credit standards on loans to both enterprises and households in the

fi rst quarter of 2011. As regards the demand for loans, survey participants reported, on the one

hand, a noticeable increase in net demand for corporate loans and, on the other hand, a decline

in net demand for both mortgage and consumer credit.

1 The cut-off date of the survey was 31 March 2011. A comprehensive assessment of its results was published on 27 April 2011 on the

ECB’s website.

23ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Monetary and

financial

developments

Loans and credit lines to enterprises

Credit standards: In the fi rst quarter of 2011 the net percentage 2 of banks reporting a tightening

of credit standards on loans and credit lines to enteprises stood at 4%, compared with 0% in the

previous quarter (see Chart A). This is broadly in line with what survey participants expected

three months before (2%). In terms of maturity, credit standards on short-term loans continued to

be loosened (-2%, compared with -3% in the previous survey round), while those on long-term

loans were tightened.

Looking at the factors underlying the overall developments in credit standards, banks’ ability to

access market fi nancing (9%, after 3% in the last quarter of 2010) and banks’ liquidity position

(7% after 2%) were reported to have contributed more to a net tightening of credit standards than

in the previous quarter. At the same time, the contribution of factors related to the perception

of risks (in particular, expectations regarding general economic activity and the industry or

fi rm-specifi c outlook) remained broadly unchanged, while competitive pressures in loan markets

had an ongoing easing impact.

According to survey participants, most non-price terms and conditions were tightened, although

marginally less than in the previous round. At the same time, margins on riskier loans were

2 The reported net percentage refers to the difference between the proportion of banks reporting that credit standards have been tightened

and the proportion of banks reporting that they have been eased. A positive net percentage indicates that banks have tended to tighten

credit standards (“net tightening”), whereas a negative net percentage indicates that banks have tended to ease credit standards

(“net easing”).

Chart A Changes in credit standards applied to the approval of loans or credit lines to enterprises

(net percentages)

-20

0

20

40

60

80

100

-20

0

20

40

60

80

100

(a) (e) (d) (c) (b) (f)

realised

expected

Factors contributing to tightening credit standards

Bank’s ability to

access market

financing

Costs related to

bank’s capital

Expectations

regarding general

economic activity

Industry or firm-

specific outlook

Bank’s liquidity

position

Q1 Q3 Q1 Q3 Q1 Q1 Q3 Q1 Q3 Q1 Q1Q3 Q1 Q3 Q1 Q1Q3Q1 Q3 Q1 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q42009 2010 2011 2009 2010 2009 2010 2009 2010 2009 2010 2009 2010

Notes: In panel (a), the net percentages refer to the difference between the sum of the percentages for “tightened considerably” and “tightened somewhat” and the sum of the percentages for “eased somewhat” and “eased considerably”. The net percentages for the questions related to the factors are the difference between the percentage of banks reporting that the given factor contributed to tightening and the percentage reporting that it contributed to easing. “Realised” values refer to the period in which the survey was conducted. “Expected” values refer to the expected changes over the next three months.

24ECB

Monthly Bulletin

May 2011

raised slightly (by 20% of banks in net terms compared with 18% in the last quarter of 2010),

while margins on average loans were actually reduced (see Chart B).

Looking ahead, euro area banks still expect a slight net tightening of credit standards on loans to

enterprises in the second quarter of 2011 (3%; see Chart A), which would affect both SMEs and

large fi rms equally and would primarily affect long-term loans.

Loan demand: In the fi rst quarter of 2011 net demand for loans 3 from enterprises increased to

19%, from 10% in the fourth quarter of 2010 (see Chart C). Similar developments were reported

with respect to loans to large enterprises (16%, up from 11% in the previous round), while

for loans to SMEs, net demand was still positive but slightly lower than what was reported in

the January 2011 round (13%, after 19% in the previous three months). As regards maturities,

net demand for both short and long-term loans stood at similar levels to what was indicated by

survey participants three months ago (14% and 18% respectively).

The improvement in overall net demand was mainly driven by a pick-up in needs for inventories

and working capital (18%, up from 13% in the last quarter of 2010) and, for the fi rst time in more

than two years, positive developments in fi xed investment (12%, after 0% in the January 2011

round). At the same time, euro area banks indicated that the infl uence of alternative sources of

fi nancing, either internal or external, became broadly neutral.

Looking ahead, on balance, euro area banks expect net loan demand from enterprises to increase

in the second quarter of 2011 (to 26%). This increase is expected to apply to a larger extent to

SMEs (24%) than to large fi rms (18%). Furthermore, banks expect an ongoing alignment of

dynamics across maturities, with expected net demand for short and long-term loans converging

further (25% and 22% respectively).

3 The net demand for loans is calculated as the difference between the percentage of banks reporting that demand for loans has increased

and the percentage reporting that demand for loans has decreased.

Chart B Changes in terms and conditions for approving loans or credit lines to enterprises

(net percentages of banks reporting tightening terms and conditions)

-5

0

5

10

15

20

25

30

-5

0

5

10

15

20

25

30

(a) (e) (d) (c) (b) (g) (f)

Q1 Q3 Q1 Q1 Q3 Q1 Q1 Q3 Q1 Q1 Q3 Q1 Q1 Q3 Q1 Q1 Q3 Q1 Q1 Q3 Q1

Margins on

average loans

Margins on

riskier loans

Size of loan

or credit line

Collateral

requirements

Loans

covenants

Non-interest

rate charges

Maturity

2010 2011 2010 2011 2010 2011 2010 2011 2010 2011 2010 2011 2010 2011

Note: The net percentages refer to the difference between the sum of the percentages for “tightened considerably” and “tightened somewhat” and the sum of the percentages for “eased somewhat” and “eased considerably”.

25ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Monetary and

financial

developments

Loans to households for house purchase

Credit standards: In the fi rst quarter of 2011 the net percentage of banks reporting a tightening

of credit standards for loans to households for house purchase stood at 13%, compared with 9%

in the previous quarter (see Chart D). The increase in the net tightening appears to be explained

mainly by an increase in banks’ cost of funds and balance sheet constraints (14%, after 5%

in the fourth quarter of 2010), as well as a slight deterioration in risk perception (in particular

Chart C Changes in demand for loans or credit lines to enterprises

(net percentages)

-70

-50

-30

-10

10

30

50

-70

-50

-30

-10

10

0 0

30

50

Q1 Q3 2009 2009 2009 2009 20092010 2010 2010 2010 20102011 20112011

Q1 Q3 Q1 Q1 Q3 Q1 Q3 Q1 Q2 Q4 Q2 Q4 Q1 Q3 Q1 Q3 Q1 Q2 Q4 Q2 Q4

realised

expected

Fixed investment Issuance of debt

securities

Factors contributing to increasing demand

Issuance of equity

(a) (e) (d) (c) (b)

Inventories and

working capital

Notes: In panel (a), the net percentages refer to the difference between the sum of the percentages for “increased considerably” and “increased somewhat” and the sum of the percentages for “decreased somewhat” and “decreased considerably”. The net percentages for the questions related to the factors are the difference between the percentage of banks reporting that the given factor contributed to an increase in demand and the percentage reporting that it contributed to a decline. “Realised” values refer to the period in which the survey was conducted. “Expected” values refer to the expected changes over the next three months.

Chart D Changes in credit standards applied to the approval of loans to households for house purchase

(net percentages)

-20

-10

0

10

20

30

40

50

60

-20

-10

0

10

20

30

40

50

60

realised

expected

Q1 Q3 Q1 Q3 Q1 Q1 Q3 Q1 Q3 Q1Q1 Q3 Q1 Q3 Q1Q1 Q3 Q1 Q3 Q1Q1 Q3 Q1 Q3 Q1

2009 2010 2011 2009 2010 2011 2009 2010 2011 2009 2010 2011 2009 2010 2011

Factors contributing to tightening credit standards

Housing market

prospects

Expectations

regarding general

economic activity

Cost of funds and

balance sheet

constraints

Competition from

other banks

(a) (b) (c) (d) (e)

realised

expected

Note: See notes to Chart A.

26ECB

Monthly Bulletin

May 2011

expectations regarding general economic activity, which stood at 9% compared with 6% in the

previous survey round).

According to the survey respondents, most price and non-price terms and conditions were

tightened overall in the fi rst quarter of 2011. In particular, the net percentage of banks reporting

a tightening of margins on riskier loans rose from 10% in the previous survey round to 19% in

the fi rst quarter of 2011. In the case of margins on average loans, this percentage turned positive,

from -1% in the last quarter of 2010 to 11% in the fi rst quarter of 2011. Euro area banks also

reported a net tightening of the loan-to-value ratio (9%, after 1% in the previous survey round)

and of maturity (6% after 0%).

Looking ahead, for the second quarter of 2011, banks still expect credit standards on loans to

households for house purchase to be tightened in net terms (9%).

Loan demand: Net demand for housing loans contracted considerably in the fi rst quarter of 2011,

as the net percentage of banks reporting a decrease in demand for housing loans stood at -10%

(after 23% in the previous quarter; see Chart E). This was mainly on account of a deterioration in

housing market prospects as well as faltering consumer confi dence.

Looking forward, however, banks expect a mild increase in the demand for housing loans in the

second quarter of the year (5% in net terms).

Consumer credit and other lending to households

Credit standards: Broadly in line with expectations, the net percentage of banks reporting a

tightening of credit standards on consumer credit and other lending to households stood at 7% in

Chart E Changes in demand for loans to households for house purchase and consumer credit

(net percentages)

-40

-20

0

20

40

-40

-20

0

20

40

Q1 Q2 Q3 Q4 Q1 Q2

(a) (b)

Q3 Q4 Q1 Q2 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

2009 2010 2011 2009 2010 2011

realised

expected

Loans for house purchase Consumer credit

Notes: The net percentages refer to the difference between the sum of the percentages for “increased considerably” and “increased somewhat” and the sum of the percentages for “decreased somewhat” and “decreased considerably”. “Realised” values refer to the period in which the survey was conducted. “Expected” values refer to the expected changes over the next three months.

27ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Monetary and

financial

developments

the fi rst quarter of 2011 (up from 2% in the previous quarter; see Chart F). Similarly to corporate

and housing loans, banks’ increased cost of funds and balance sheet constraints (9%, after 5% in

the previous survey round), as well as a deterioration in expectations regarding general economic

activity (6% after 2%), were the factors contributing the most to the net tightening of credit

standards.

Looking ahead, banks still expect a net tightening of credit standards on consumer credit and

other lending to households in the second quarter of 2011 (8%).

Loan demand: Contrary to expectations in the previous survey round, net demand for consumer

credit was not positive in the fi rst quarter of 2011, but instead slightly decreased to -4%

(from -2% in the last quarter of 2010; see Chart E). It was mainly dampened by developments in

consumer confi dence.

Looking ahead, banks expect positive net demand for consumer credit and other lending to

households in the second quarter of 2011 (6%).

Ad hoc question on the impact of the fi nancial turmoil

As in previous survey rounds, the April 2011 survey also contained an ad hoc question aimed

at assessing the extent to which the fi nancial market tensions affected banks’ access to the

wholesale funding market in the fi rst quarter of 2011, and the extent to which they might still

have an effect in the second quarter of 2011.

For the fi rst quarter of 2011 banks generally reported a deterioration in their access to

short-term money markets and debt securities markets (although the deterioration was less

pronounced than in the previous survey round), as well as in their access to true-sale securitisation

of corporate loans (see Chart G). At the same time, they noted broadly unchanged conditions for

the securitisation of housing loans and an improved ability to transfer risks off banks’ balance

Chart F Changes in credit standards applied to the approval of consumer credit and other lending to households

(net percentages)

-10

0

10

20

30

40

50

60

-10

0

10

20

30

40

50

60

(a) (b) (c) (d) (e)

Factors contributing to tightening credit standards

Expectations

regarding general

economic activity

Creditworthiness

of consumers

Competition from

other banks

Risk on collateral

demanded

Q1 Q3 Q1 Q3 Q3Q1 Q1 Q3Q1 Q2 Q2Q1 Q1 Q3 Q1 Q1 Q2 Q4 Q2 Q4Q3Q4 Q42009 2010 2011 2010 2011 2011 2011 20112009 2009 2010 2009 2010 2009 2010

realised

expected

Note: See notes to Chart A.

28ECB

Monthly Bulletin

May 2011

2.2 SECURITIES ISSUANCE

The annual growth of debt securities issued by euro area residents increased in February 2011, owing to expanding debt issuance on the part of MFIs. By contrast, the annual growth of debt securities issued by non-fi nancial corporations continued along the downward trend recorded over the past year, but remained at a robust level. The moderation of debt issuance by the non-fi nancial corporate sector may partly refl ect the ongoing normalisation of demand for bank loans observed over recent months. The annual growth rate of debt securities issued by the general government declined in February. The annual rate of increase in issuance of quoted shares declined slightly and remained at a subdued level.

sheets. On balance, 12% of euro area banks (excluding banks replying “not applicable”) reported

deteriorated access to short-term money markets with maturities exceeding one week (contrasting

with 24% in the previous survey round), whereas access to very short-term money markets

slightly improved for 2% of the surveyed banks (compared with 3% indicating a deterioration

in the previous round). Deteriorated access was reported for debt securities markets (by 6-10%

of the banks compared with around 30% in the previous quarter) and for true-sale securitisation

of corporate loans (by 8% of the banks). In net terms, conditions for the securitisation of loans

to households remained broadly unchanged, while the ability to transfer risks off banks’ balance

sheets improved (according to 5% of the banks surveyed).

Looking ahead, euro area banks expect access to money markets to ease and possibly start to

improve overall in the second quarter of 2011. By contrast, access to debt securities markets

could still deteriorate, albeit less than in the fi rst quarter. Conditions for the securitisation of

corporate loans are also expected to continue to deteriorate in the second quarter.

Chart G Change in the access to wholesale funding over the past three months

(net percentages of banks reporting deteriorated market access)

-30

-20

-10

0

10

20

30

40

-30

-20

-10

0

10

20

30

40

very short-term

money market

short-term

money market

short-term

debt securities

medium to

long-term

debt securities

securitisation of

corporate loans

securitisation

of loans for

house purchase

ability to transfer

credit risk off

balance sheet

Q3 2010

Q4 2010

Q1 2011

Q2 2011 (expected)

Note: The net percentages are defi ned as the difference between the sum of the percentages for “deteriorated considerably” and “deteriorated somewhat” and the sum of the percentages for “eased somewhat” and “eased considerably”.

29ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Monetary and

financial

developments

DEBT SECURITIES

In February 2011 the annualised growth rate of debt securities issued by euro area residents rose to

4.1%, compared with 3.7% in the previous month (see Table 4). While the pace of contraction in

short-term debt securities issuance continued to decelerate, reaching -4.4% in February, the annual

growth of long-term debt issuance edged up from 4.9% in January 2011 to 5.1% in February.

However, the annualised and seasonally adjusted six-month growth rate of debt securities issued,

which better captures short-term trends, declined to 3.8% in February, from 5.0% in January

(see Chart 9). This was due primarily to a decline

in debt issuance by non-fi nancial corporations,

down to 5.6% in February from 7.3% in the

previous month (see Table 4). Borrowing by

the general government also declined to 7.0%,

thus remaining high. By contrast, debt issuance

by MFIs increased, up from zero to 1.6%

in February.

Over recent months, refi nancing activity

remained concentrated on issuance in the

long-term segment, in particular at fi xed rates.

The annual rate of increase in issuance of

fi xed rate long-term debt securities remained

broadly stable at 6.8% in February. At the same

time, issuance of fl oating rate long-term debt

securities rose to around 1.3% in February, thus

remaining in positive territory for the fourth

successive month.

From a sectoral perspective, the annual growth

of debt security issuance by the general

government and by non-fi nancial corporations

declined in February. The issuance activity

Table 4 Securities issued by euro area residents

Issuing sector

Amount outstanding (EUR billions) 2011 February

Annual growth rates 1) 2010

Q1 2010

Q2 2010

Q3 2010

Q4 2011

January 2011

February

Debt securities 16,030 6.5 4.7 3.5 3.6 3.7 4.1 MFIs 5,361 1.6 0.6 -0.5 0.0 0.1 1.6

Non-monetary fi nancial corporations 3,282 7.6 3.2 1.2 1.6 1.8 2.3

Non-fi nancial corporations 833 14.7 15.1 10.3 8.3 7.3 5.6

General government 6,555 9.9 8.3 7.6 7.5 7.5 7.0

of which:Central government 6,013 9.9 8.1 7.1 6.9 7.1 6.7

Other general government 542 10.5 11.4 15.3 16.2 14.0 11.6

Quoted shares 4,844 2.9 2.5 1.8 1.7 1.3 1.4 MFIs 535 8.3 6.6 5.2 6.6 6.2 6.8

Non-monetary fi nancial corporations 376 5.4 5.2 4.3 3.4 1.5 2.3

Non-fi nancial corporations 3,933 1.9 1.5 1.0 0.8 0.6 0.6

Source: ECB.1) For details, see the technical notes for Sections 4.3 and 4.4 of the “Euro area statistics” section.

Chart 9 Sectoral breakdown of debt securities issued by euro area residents

(six-month annualised growth rates; seasonally adjusted)

-10

0

10

20

30

40

50

60

70

-10

0

10

20

30

40

50

60

70

1999 2001 2003 2005 2007 2009 2011

total

MFIs

non-monetary financial corporations

non-financial corporations

general government

Source: ECB.

30ECB

Monthly Bulletin

May 2011

of non-fi nancial corporations continued the

downward trend recorded over the past year

as the annual rate of increase in such issuance

declined by around 1.7 percentage points to

5.6% in February. A sharper contraction of short-

term debt securities issuance was only partially

offset by an increase in issuance of long-term

debt securities. The ongoing moderation in debt

securities issuance by non-fi nancial corporations

may partly refl ect the normalisation of demand

for bank loans observed in recent months.

Public borrowing remained high. However, the

annual growth of debt securities issued by the

general government sector declined to 7.0% in

February. The downward trend that started in

September 2009 seems to have levelled off. The

robust debt issuance activity on the part of the

general government sector refl ects the still high

public sector funding needs in the euro area.

Turning to the fi nancial sector, the annual

growth rate of debt securities issued by MFIs

increased from zero to 1.6% in February. Net issuance of short-term debt securities turned positive

and stood at 1.4% in February, potentially refl ecting a more favourable access to funding for euro

area banks. Similarly, net issuance of long-term debt securities rose to 1.7% in February, reaching

the highest level recorded since May 2010. Finally, the annual growth rate of debt securities issued

by fi nancial corporations other than MFIs rose from 1.8% in January 2011 to 2.3% in February.

QUOTED SHARES

The annual growth rate of quoted shares issued by euro area residents increased slightly to 1.4%

in February, mainly on account of equity issuance activity on the part of MFIs and fi nancial

corporations other than MFIs (see Chart 10). Indeed, the annual rate of growth in equity issuance by

MFIs rose to 6.8% in February 2011, from 6.2% in January 2011. Equity issuance activity by MFIs

remained robust, given the ongoing efforts of many euro area banks to strengthen their balance

sheets by replenishing their capital bases. At the same time, the annual growth rate of quoted

shares issued by fi nancial corporations other than MFIs increased from 1.5% in January to 2.3%

in February. The annual growth of quoted shares issued by non-fi nancial corporations remained

broadly stable at 0.6%.

2.3 MONEY MARKET INTEREST RATES

Money market interest rates increased further between early April and early May 2011, with interest rates at the twelve-month maturity reaching levels last observed in February 2009. During the fourth maintenance period of 2011, which began on 13 April, the EONIA was relatively stable for the fi rst week, before increasing above the fi xed rate in the main refi nancing operations ahead of the Easter holiday period. On 21 April the EONIA spiked to stand at 1.43%. It remained relatively volatile thereafter, standing at 1.05% on 4 May.

Chart 10 Sectoral breakdown of quoted shares issued by euro area residents

(annual growth rates)

-4

-2

0

2

4

6

8

10

12

-4

-2

0

2

4

6

8

10

12

20011999 2003 2005 2007 2009 2011

totalMFIs

non-monetary financial corporations

non-financial corporations

Source: ECB.Note: Growth rates are calculated on the basis of fi nancial transactions.

31ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Monetary and

financial

developments

Unsecured money market interest rates increased between early April and early May 2011, refl ecting

the 25 basis point increase in the key ECB interest rates, which took effect as of the operations settled

on 13 April. On 4 May the one-month, three-month, six-month and twelve-month EURIBOR stood

at 1.25%, 1.42%, 1.70% and 2.16% respectively – i.e. 24, 15, 12 and 12 basis points higher than the

levels observed on 6 April. The spread between the twelve-month and one-month EURIBOR – an

indicator of the slope of the money market yield curve – decreased by 11 basis points to stand at

91 basis points on 4 May (see Chart 11).

Between 6 April and 4 May the money market rate derived from the three-month EONIA swap

index increased slightly more than the corresponding unsecured rate. The three-month EONIA swap

rate stood at 1.24% on 4 May, 20 basis points higher than on 6 April. Thus, the spread between the

unsecured three-month EURIBOR and the secured three-month EONIA swap rate decreased to

18 basis points on 4 May, 5 basis points lower than on 6 April, indicating some further normalisation

in the money markets.

The interest rates implied by the prices of three-month EURIBOR futures maturing in June,

September and December 2011 and March 2012 stood at 1.60%, 1.92%, 2.17% and 2.37%

respectively on 4 May, representing increases of around 7, 6 and 4 basis points and a decline of

around 1 basis point compared with the levels observed on 6 April. These increases imply an

upward shift in the forward curve.

From 6 April to the end of the third maintenance period of 2011, the EONIA was relatively stable

at around 0.55%. On 13 April the EONIA began the fourth maintenance period of the year at a

higher level, standing at 1.14%, refl ecting the 25 basis point increase in the key ECB interest rates.

The EONIA initially remained stable around this level, before increasing above the fi xed rate in the

main refi nancing operations ahead of the Easter holiday. It spiked to stand at 1.43% on 21 April and

remained relatively volatile thereafter, standing at 1.05% on 4 May (see Chart 12).

Chart 11 Money market interest rates

(percentages per annum; spread in percentage points; daily data)

0.0

0.3

0.6

0.9

1.2

1.5

1.8

2.1

2.4

0.55

0.65

0.75

0.85

0.95

1.05

1.15

1.25

1.35

Apr. June Aug. Oct. Dec. Feb. Apr.2010 2011

one-month EURIBOR (left-hand scale)

three-month EURIBOR (left-hand scale)

twelve-month EURIBOR (left-hand scale)

spread between twelve-month and one-month

EURIBOR (right-hand scale)

Sources: ECB and Thomson Reuters.

Chart 12 ECB interest rates and the overnight interest rate

(percentages per annum; daily data)

0.0

0.5

1.0

1.5

2.0

2.5

0.0

0.5

1.0

1.5

2.0

2.5

fixed rate in the main refinancing operations

interest rate on the deposit facility

overnight interest rate (EONIA)

interest rate on the marginal lending facility

Apr. June Aug. Oct. Dec. Feb. Apr.2010 2011

Sources: ECB and Thomson Reuters.

32ECB

Monthly Bulletin

May 2011

The Eurosystem conducted a number of refi nancing operations between 6 April and 4 May.

On 12 April the Eurosystem conducted a fi ne-tuning operation in which €78.9 billion was absorbed

in order to counter the liquidity surplus at the end of the third maintenance period of 2011. In the

main refi nancing operations of the fourth maintenance period, which were conducted on 12,

19 and 26 April and 3 May, the Eurosystem allotted €94.1 billion, €97.4 billion, €117.9 billion and

€127.5 billion respectively. The Eurosystem also conducted two longer-term refi nancing operations

in April, both as fi xed rate tender procedures with full allotment: a special-term refi nancing operation

on 12 April with a maturity of one maintenance period (in which €83.7 billion was allotted); and

a three-month longer-term refi nancing operation on 27 April in which €63.4 billion was allotted.

The Eurosystem also conducted four one-week liquidity-absorbing operations on 12, 19 and

26 April and 3 May as variable rate tender procedures with a maximum bid rate of 1.25%. With these

operations, the Eurosystem absorbed liquidity provided by purchases made under the Securities

Markets Programme. While the fi rst two operations absorbed that liquidity in full, there was

underbidding in the last two liquidity-absorbing operations, possibly related to end-of-month effects

and/or the rolling over of maturing longer-term refi nancing operations. In addition, in the period

from 21 April to 3 May overnight rates exceeded the maximum bid rate in the liquidity-absorbing

operations, which may have reduced the attractiveness of placing liquidity with the ECB.

The levels of excess liquidity during the fourth maintenance period, which began on 13 April,

were relatively low compared with the previous maintenance periods in 2011, with average daily

recourse to the deposit facility falling to stand at €18.4 billion on 4 May.

2.4 BOND MARKETS

In the course of April and early May, the yield on AAA-rated long-term government bonds declined slightly, overall, in both the euro area and the United States. While the economic momentum remained positive, mixed economic data releases in the United States and the re-intensifi cation of tensions in euro area sovereign debt markets weighed on market sentiment as well. The ongoing tensions in northern Africa and the Middle East continue to exert downward pressure on government debt yields. Implied bond market volatility in the euro area remained unchanged in April, while it declined slightly in the United States. Intra-euro area sovereign bond yield spreads widened further for Greece and Portugal. Data on long-term break-even infl ation rates in early April continue to indicate that infl ation expectations remain fi rmly anchored.

In the course of April and early May, AAA-rated long-term euro area government bond yields

declined by about 10 basis points to stand at 3.5% on 4 May. In the United States, long-term

bond yields declined by some 20 basis points over the same period, standing at 3.3% on 4 May

(see Chart 13). Consequently, the nominal interest rate differential between ten-year government

bond yields in the United States and those in the euro area declined by 10 basis points in the period

under review. Implied bond market volatility in the euro area remained unchanged between the end

of March and early May. In the United States, by contrast, implied bond market volatility declined

slightly. In Japan, ten-year government bond yields remained broadly unchanged, standing at 1.2%

on 4 May.

Developments in AAA-rated long-term euro area government bond yields continue to be driven

by the positive economic momentum in the euro area, the United States and the world economy at

large, on the one hand, and by the re-intensifi cation of tensions in certain sovereign debt markets,

33ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Monetary and

financial

developments

on the other. Other factors such as the political tensions in northern Africa and the Middle East

also contributed negatively to market sentiment. In the United States, the economic momentum

remains positive. In the course of April, however, the downward revision of the growth projections

for 2011 and 2012 by the Federal Reserve, and the release of GDP growth fi gures for the fi rst

quarter of 2011, disappointed market sentiment. The downgrading of the outlook of the US debt by

a rating agency did not have any discernible impact on US government bond yields.

Tensions in euro area sovereign debt markets intensifi ed signifi cantly in April. Over the review

period, the spread of Greek and Portuguese sovereign debt yields vis-à-vis German sovereign debt

yields widened further to reach record levels. This was driven primarily by the fact that market

participants appear to regard a restructuring of Greek debt as becoming more likely. Irish sovereign

debt yield spreads vis-à-vis Germany, which had narrowed over the fi rst week of April, following the

release of the generally positive Irish bank stress tests, were likewise negatively affected by market

participants’ speculation on Greek debt. In the course of April some market participants also feared

the prospect of the crisis spreading to other euro area countries over and beyond Greece, Ireland

and Portugal. However, the widening of the spreads of Spanish, Italian and Belgian government

debt was contained over the period under review.

Yields on ten-year infl ation-linked euro area government bonds declined slightly over the period

under review, while the real yields on corresponding fi ve-year bonds remained broadly unchanged

(see Chart 14). On 4 May, fi ve and ten-year spot real yields stood at 0.6% and 1.3% respectively.

Over the period under review, implied forward break-even infl ation rates (fi ve-year forward fi ve

years ahead) in the euro area remained broadly unchanged, standing at 2.3% on 4 May (see Chart 15).

This and the fi ve-year forward fi ve years ahead infl ation swap rate, which also remained unchanged

to stand at around 2.4% on that date, indicate that market participants’ infl ation expectations remain

Chart 13 Long-term government bond yields

(percentages per annum; daily data)

2.1

2.5

2.9

3.3

3.7

4.1

0.6

1.0

1.4

1.8

2.2

2.6

Apr. June Aug. Oct. Dec. Feb. Apr.2010 2011

euro area (left-hand scale)

United States (left-hand scale)

Japan (right-hand scale)

Sources: Bloomberg and Thomson Reuters.Note: Long-term government bond yields refer to ten-year bonds or to the closest available bond maturity.

Chart 14 Euro area zero coupon inflation-linked bond yields

(percentages per annum; fi ve-day moving averages of daily data; seasonally adjusted)

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

Apr. June Aug. Oct. Dec. Feb. Apr.2010 2011

five-year forward inflation-linked bond yield

five years ahead

five-year spot inflation-linked bond yield

ten-year spot inflation-linked bond yield

Sources: Thomson Reuters and ECB calculations.

34ECB

Monthly Bulletin

May 2011

fi rmly anchored. Break-even infl ation rates have been very volatile over the past two months,

possibly refl ecting the fact that the nominal yield curve has responded more promptly to recent

episodes of fl ight to safety than the real yield curve. Estimates of implied infl ation expectations

inferred from break-even infl ation rates, however, remained broadly unchanged throughout those

episodes.

The general pattern of long-term euro area bond yields can be decomposed into changes in interest

rate expectations (and related risk premia) at different horizons (see Chart 16). Compared with the

end of March, the term structure of short-term forward rates for maturity horizons longer than three

years has shifted downwards by around 15 basis points, possibly refl ecting lower risk premia.

Spreads on investment-grade corporate bonds issued by non-fi nancial corporations remained

broadly unchanged across credit ratings over the period under review. These spreads appear to

be aligned to current prospects of default for non-fi nancial corporations, which are in line with

historical averages and well below the high values recorded during the recent fi nancial crisis.

Spreads on investment-grade corporate bonds issued by fi nancial corporations declined across all

credit rating classes in April. The decline was highest for BBB-rated debt securities. Concerns about

the restructuring of the Greek debt, which had had a negative impact on fi nancial stock prices, were

not visible in the prices charged for debt issued by fi nancial corporations. In fact, there have been

reports of favourable issuance activity by banks. However, corporate bond yields of debt issued

by fi nancial corporations continue to trade at a premium in comparison with average pre-crisis

conditions.

Chart 15 Euro area zero coupon break-even inflation rates

(percentages per annum; fi ve-day moving averages of daily data; seasonally adjusted)

1.0

1.5

2.0

2.5

3.0

1.0

1.5

2.0

2.5

3.0

Apr. June Aug. Oct. Dec. Feb. Apr.2010 2011

five-year forward break-even inflation rate

five years ahead

five-year spot break-even inflation rateten-year spot break-even inflation rate

Sources: Thomson Reuters and ECB calculations.

Chart 16 Implied forward euro area overnight interest rates

(percentages per annum; daily data)

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

2011 2013 2015 2017 2019 2021

4 May 2011

31 March 2011

Sources: ECB, EuroMTS (underlying data) and Fitch Ratings (ratings).Notes: The implied forward yield curve, which is derived from the term structure of interest rates observed in the market, refl ects market expectations of future levels for short-term interest rates. The method used to calculate these implied forward yield curves is outlined in the “Euro area yield curve” section of the ECB’s website. The data used in the estimate are AAA-rated euro area government bond yields.

35ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Monetary and

financial

developments

2.5 INTEREST RATES ON LOANS AND DEPOSITS

In March 2011 most MFI lending rates for households and non-fi nancial corporations were broadly stable in the case of short maturities, but increased somewhat for long maturities. By historical standards, MFI lending rates for both households and non-fi nancial corporations are still very low across all maturities.

In March 2011 short-term MFI interest rates on deposits remained almost unchanged for both

households and non-fi nancial corporations. Most MFI rates on short-term loans to households for

house purchase, as well as MFI interest rates on short-term loans to non-fi nancial corporations,

were broadly stable (see Chart 17). More precisely, interest rates on short-term housing

loans and on households’ overdrafts stood at around 3.0% and 8.8% respectively in March.

The normally more volatile rates on consumer credit remained broadly unchanged at 5.4%.

As regards non-fi nancial corporations, banks’ short-term rates on small loans (i.e. loans of up to

€1 million) and on large loans (i.e. loans of more than €1 million) remained more or less stable at

3.7% and 2.6% respectively. Interest rates on overdrafts continued to stand at around 4.0%. With

the EURIBOR increasing by 15 basis points in March, the spread between short-term MFI lending

rates and the three-month money market rate

declined slightly both for loans to households

for house purchase and for loans to non-fi nancial

corporations (see Chart 18).

Taking a longer-term perspective, short-term

rates on both loans to households for house

purchase and loans to non-fi nancial corporations

decreased by around 300 basis points between

end-September 2008 (i.e. immediately prior to

the beginning of the cycle of monetary policy

easing) and end-March 2011. This compares

with a decline of 400 basis points in the three-

month EURIBOR and indicates a signifi cant

pass-through of changes in market rates to bank

lending rates over the period.

Turning to longer maturities, MFI interest rates

on long-term deposits rose slightly for both

households and non-fi nancial corporations in

March 2011. Most interest rates on longer-term

loans to non-fi nancial corporations remained

broadly stable or increased. By contrast, longer-

term rates on loans to households for house

purchase edged up (see Chart 19). Specifi cally,

the rates on loans to households for house

purchase with an initial rate fi xation period of

over fi ve and up to ten years increased by around

10 basis points to 4.2%, thus nevertheless

remaining close to all-time lows. As regards

non-fi nancial corporations, the average rates on

Chart 17 Short-term MFI interest rates and a short-term market rate

(percentages per annum; rates on new business)

0

1

2

3

4

5

6

7

8

9

10

0

1

2

3

4

5

6

7

8

9

10

2003 2004 2005 2006 2007 2008 2009 2010

deposits from households redeemable at notice

of up to three months

deposits from households with an agreed maturity

of up to one year

overnight deposits from non-financial corporations

loans to households for consumption with a floating

rate and an initial rate fixation period of up to one year

loans to households for house purchase with a floating

rate and an initial rate fixation period of up to one year

loans to non-financial corporations of over €1 million

with a floating rate and an initial rate fixation period

of up to one yearthree-month money market rate

Source: ECB.Note: Data as of June 2010 may not be fully comparable with those prior to that date owing to methodological changes arising from the implementation of Regulations ECB/2008/32 and ECB/2009/7 (amending Regulation ECB/2001/18).

36ECB

Monthly Bulletin

May 2011

large-sized loans with an initial rate fi xation period of over fi ve years remained broadly unchanged

at 3.8%. Average interest rates on small-sized loans with an initial rate fi xation period of over

fi ve years increased somewhat to 4.2%. The average rates on large loans with an initial rate fi xation

period of over one year and up to fi ve years declined by around 30 basis points to stand at 2.9%,

while the average rates on small loans with similar fi xation period increased to 4.5%.

Viewed from a longer-term perspective, since September 2008, euro area banks have adjusted

their rates on long-term loans to non-fi nancial corporations more or less in line with the decline in

AAA-rated long-term government bond yields. Rates on long-term loans to households did not fall

as much over this period, refl ecting a more incomplete and sluggish pass-through for households.

Nevertheless, until the beginning of 2011, interest rates on longer-term loans to households have

followed a declining trend, while market interest rates have been rising. As a result, the spread

of long-term rates on loans to households vis-à-vis AAA-rated long-term government bond yields

has narrowed since August, standing at around 100 basis points in March. For non-fi nancial

corporations, the upward trend in long-term lending rates has recently fl attened, also resulting in a

narrowing of the spread vis-à-vis long-term government bond yields.

Weighted by new business volumes, average bank lending rates declined somewhat in March,

while average rates on deposits increased slightly, causing loan-deposit margins on new loans to

tighten a little. The margins remain just above historically low levels. As was the case in recent

Chart 18 Spreads of short-term MFI interest rates vis-à-vis the three-month money market rate

(percentage points; rates on new business)

-2.0

-1.5

-1.0

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

-2.0

-1.5

-1.0

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

loans to non-financial corporations of over €1 million

with a floating rate and an initial rate fixation period

of up to one year

loans to households for house purchase with a floating

rate and an initial rate fixation period of up to one year

deposits from households with an agreed maturity

of up to one year

2003 2004 2005 2006 2007 2008 2009 2010

Source: ECB.Notes: For the loans, the spreads are calculated as the lending rate minus the three-month money market rate. For the deposits, the spread is calculated as the three-month money market rate minus the deposit rate. Data as of June 2010 may not be fully comparable with those prior to that date owing to methodological changes arising from the implementation of Regulations ECB/2008/32 and ECB/2009/7 (amending Regulation ECB/2001/18).

Chart 19 Long-term MFI interest rates and a long-term market rate

(percentages per annum; rates on new business)

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

5.5

6.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

5.5

6.0

deposits from non-financial corporations with an

agreed maturity of over two years

deposits from households with an agreed maturity

of over two years

loans to non-financial corporations of over €1 million

with an initial rate fixation period of over five years

loans to households for house purchase with an initial

rate fixation period of over five and up to ten years

seven-year government bond yield

2003 2004 2005 2006 2007 2008 2009 2010

Source: ECB.Note: Data as of June 2010 may not be fully comparable with those prior to that date owing to methodological changes arising from the implementation of Regulations ECB/2008/32 and ECB/2009/7 (amending Regulation ECB/2001/18).

37ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Monetary and

financial

developments

months, average loan-deposit margins on outstanding amounts again remained broadly unchanged

in March. Unchanged margins contribute positively to the net interest income and profi tability of

euro area banks.

2.6 EQUITY MARKETS

In the course of April and early May, stock prices rose in both the euro area and the United States. While developments in stock prices continue to benefi t from the generally positive economic momentum, better than expected corporate earnings announcements were the main drivers behind stock price increases on both sides of the Atlantic in April. Stock market uncertainty, as measured by implied volatility, declined slightly.

Euro area and US stock prices increased in the course of April and early May. Overall, between

31 March and 4 May, euro area stock prices, as measured by the broad-based Dow Jones EURO

STOXX index, increased by 1.3%, while the Standard and Poor’s 500 index in the United States

rose by 1.6% (see Chart 20). Over the same period, stock prices in Japan, as measured by the

Nikkei 225 index, increased by 2.6%.

The increase in stock prices in April marks a return to the trend that started in mid-2010. This trend

was only temporarily blurred in March, as a result of the safe-haven fl ows triggered by political

developments in northern Africa and the Middle East, and by the uncertainties surrounding the

economic impact of the devastating earthquake in Japan. Although the economic momentum

remained a factor supporting stock prices, economic data releases, while favourable, were not to

the upside of market expectations. In the euro area, retail sales data and industrial production data

disappointed market participants slightly, while

the prospects for growth in the United States in

2011 and 2012 were revised downwards by the

Federal Reserve System. The re-intensifi cation

of tensions in euro area sovereign debt markets

had a negative impact on euro area stock prices.

It was thus primarily on account of the strength

of corporate earnings announcements that a

signifi cant increase in stock prices was recorded

both in the United States and in the euro

area. In the United States, corporate earnings

announcements surprised to the upside across all

sectors, while in the euro area, it was mainly the

earnings announcements of fi nancial corporations

that came as a very positive surprise.

In both the euro area and the United States, the

level of stock market uncertainty, as measured

by implied volatility, declined further over the

period under review (see Chart 21). Stock market

uncertainty in the euro area increased slightly in

mid-April, following the re-intensifi cation of

tensions in euro area sovereign debt markets.

Chart 20 Stock price indices

(index: 1 April 2010 = 100; daily data)

70

75

80

85

90

95

100

105

110

115

120

70

75

80

85

90

95

100

105

110

115

120

euro area

United StatesJapan

Apr. Apr.June Aug. Dec.Oct. Feb.

2010 2011

Source: Thomson Reuters.Note: The indices used are the Dow Jones EURO STOXX broad index for the euro area, the Standard & Poor’s 500 index for the United States and the Nikkei 225 index for Japan.

38ECB

Monthly Bulletin

May 2011

In the United States, stock market uncertainty

declined steadily in most of April, despite the

downgrading of the outlook for US debt by a

rating agency. Political tensions in northern

Africa and the Middle East, however, continue

to weigh on market sentiment.

Euro area non-fi nancial stock prices increased by

around 1.4% in April. Euro area fi nancial stock

prices initially fell as tensions in some euro area

sovereign debt markets intensifi ed in the fi rst

weeks of April, before gradually increasing

upon the release of earnings announcements

by fi nancial corporations that were better than

had been expected, thus offsetting the earlier

decline. Developments in US stock prices

were also mixed across sectors, with the

non-fi nancial sector once again performing

better than the fi nancial sector. Box 3 provides

information on the fi nancial situation and

fi nancial needs of small and medium-sized

enterprises in the euro area from September 2010

to February 2011.

Chart 21 Implied stock market volatility

(percentages per annum; fi ve-day moving average of daily data)

10

15

20

25

30

35

40

45

10

15

20

25

30

35

40

45

euro area

United States

Japan

Apr. Apr.June Aug Oct. Dec. Feb

2010 2011

Source: Bloomberg.Notes: The implied volatility series refl ects the expected standard deviation of percentage changes in stock prices over a period of up to three months, as implied in the prices of options on stock price indices. The equity indices to which the implied volatilities refer are the Dow Jones EURO STOXX 50 for the euro area, the Standard & Poor’s 500 for the United States and the Nikkei 225 for Japan.

Box 3

THE RESULTS OF THE “SURVEY ON THE ACCESS TO FINANCE OF SMALL AND MEDIUM-SIZED

ENTERPRISES IN THE EURO AREA”

This box presents the results of the fourth wave of the “Survey on the access to fi nance of

small and medium-sized enterprises in the euro area”.1 The survey was conducted between

21 February and 25 March 2011, and covered 7,532 fi rms in the euro area.2 This box provides

information on the fi nancial situation, fi nancing needs and the access to fi nancing of SMEs in the

euro area. These results are compared with those for large fi rms over the six preceding months

(i.e. from September 2010 to February 2011).

The fi nancial situation of SMEs remained more diffi cult than that of large fi rms

Overall, compared with the previous survey round 3, the fi nancial situation of euro area SMEs

remained broadly unchanged in the period from September 2010 to February 2011, while

1 For further details, see the ECB’s “Survey on the access to fi nance of SMEs in the euro area”, 27 April 2011, available on the ECB’s

website at http://www.ecb.europa.eu/stats/money/surveys/sme/html/index.en.html

2 In this round of the survey, the sample size was increased by around 1,200 fi rms. SMEs include micro fi rms (1-9 employees), small

fi rms (10-49 employees) and medium-sized fi rms (50-249 employees). Large fi rms are defi ned as fi rms with 250 employees or more.

3 The previous survey referred to the period from March to September 2010.

39ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Monetary and

financial

developments

it continued to clearly improve for large

fi rms. The net percentage of euro area SMEs

reporting an increase in turnover during

the six months preceding the interview was

slightly positive, at 3% (see Chart A). At the

same time, there were more SMEs reporting

a deterioration in profi ts than SMEs reporting

an improvement (21% in net terms as in the

previous survey). Recent hikes in oil and

commodity prices have heightened input cost

pressures and may have held profi ts back.

On balance, 69% of euro area SMEs reported

an increase in input costs (up from 44% in the

previous survey). A larger net percentage of

SMEs reported an increase in labour costs as

well. This general assessment of cost increases

is also shared by large fi rms, but their overall

situation appears to be mostly more favourable

than that of SMEs. Large fi rms continued to

register net increases in both turnover (49%)

and profi ts (68%) and the situation has clearly

improved since the previous survey round.

For large fi rms, the recovery appears broadly

based across all sectors of the economy.

For SMEs, however, only those sectors with

more cyclical, industrial operations reported

a clear improvement. Instead, services and

construction companies were still lagging

behind over the survey sample.

External fi nancing needs of euro area SMEs increased slightly

External fi nancing needs were generally

reported to have increased slightly. This is likely

to refl ect the positive underlying momentum

of the economic recovery (see Chart B). A net

percentage of 6% of SMEs saw their need for

bank loans increase between September 2010

and February 2011, compared with 3% in the

previous survey. Firms signalled, in particular,

a net increase in needs for bank overdrafts

and credit lines (up to 12%, from 9% in the

previous survey). Although the need for trade

credit changed little on balance since the last

survey, the survey continued to indicate a

slight increase in the need for inter-company

fi nancing. Compared with SMEs, a smaller

Chart A Indicators of the financial situation of euro area firms

(in net percentage of respondents)

-60

-40

-20

0

20

40

60

80

-60

-40

-20

0

20

40

60

80

2009H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2

2010 2009 2010 2009 2010Turnover Profits Input costs

SMEs

large firms

Source: ECB and European Commission survey on the access to fi nance of SMEs. Notes: Change over the preceding six months. Net percentages are defi ned as the difference between the percentage of fi rms reporting an increase for a given factor and that reporting a decrease.

Chart B External financing needs of euro area firms

(in net percentage of respondents)

-5

0

5

10

15

20

-5

0

5

10

15

20

SMEs

large firms

Bank loans Trade credit 2009 2010 2009 2010

H1 H2 H1 H2 H1 H2 H1 H2

Source: ECB and European Commission survey on the access to fi nance of SMEs.Notes: Change over the preceding six months. Net percentages are defi ned as the difference between the percentage of fi rms reporting an increase in needs and that reporting a decrease.

40ECB

Monthly Bulletin

May 2011

percentage of large fi rms reported increased needs for bank loans (1%, compared with 7% in the

previous survey), while more large fi rms, on balance, signalled increased needs for trade credit.

This is in line with the observed pro-cyclical pattern of trade credit, developments in which tend

to be closely linked to the exchange of goods and services and, hence, to economic activity.

Fixed investment and inventory, as well as working capital, contributed to this slight increase in

fi nancing needs, but their overall contribution remained broadly unchanged with respect to the

previous survey. Compared with SMEs, however, large fi rms reported a much stronger increase

in fi nancing needs related to fi xed investment and inventory and working capital.

Bank loan applications slightly more successful between September 2010 and February 2011

Between September 2010 and February 2011 around one-quarter of SMEs applied for a bank loan,

a proportion broadly unchanged from the previous survey. As in the previous survey round, nearly

half of SMEs did not apply because they had suffi cient internal funds to cover their fi nancing

needs. In fact, euro area SMEs may have made some moderate deleveraging efforts in recent

quarters, since their debt-to-asset ratio continued to decrease according to survey results.

The percentage of fi rms not applying for a loan for fear of rejection remained broadly stable

at 7%. As regards the outcome of bank loan applications, the rejection rate remained basically

unchanged with respect to the previous survey round (at 11%; see Chart C). In addition,

the number of euro area SMEs receiving the full amount they applied for continued to

increase, reaching 66%. Compared with SMEs, the situation of larger fi rms improved even

more, with 35% applying for a loan (as in the previous survey) and only 2% of them seeing

their application rejected (compared with 5% in the previous survey). Alternative sources of

fi nancing, and especially trade credit, developed along similar lines between September 2010

and February 2011.

Chart C Outcome of loan applications by euro area firms

(over the preceding six months; percentage of fi rms that applied for bank loans)

0

10

20

30

40

50

60

70

80

90

100

0

10

20

30

40

50

60

70

80

90

100

do not know

application rejected

application granted but cost too high

application granted in part

application granted in full

2009 2010 2009 2010 SMEs Large firms

H1 H2 H1 H2 H1 H2 H1 H2

Source: ECB and European Commission survey on the access to fi nance of SMEs.

41ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Monetary and

financial

developments

Availability of external fi nancing for SMEs improved, albeit moderately

For SMEs the survey results show that access to

external fi nancing sources, and in particular bank

loans, continued to improve, albeit moderately.

On balance, fi rms’ opinion about the availability

of bank loans improved by 3 percentage

points in net terms, to -9% (compared with

-12% in the previous survey round). A similar

picture emerges for trade credit availability,

where the perceived deterioration continued

to decline during the same period. By contrast,

for euro area large fi rms, the assessment was

clearly positive and showed an increase in the

availability of bank loans (as well as of debt

securities and equity). Overall, issues related

to “access to fi nance” were quoted as the most

pressing problem by 16% of responding SMEs, a

proportion broadly similar to that of the previous

survey, while this percentage stood at 10% for

large fi rms (also broadly unchanged from the previous survey). “Finding customers” remained by far

the most pressing problem facing euro area SMEs (for 25% of them), while 14% of SMEs reported

either “competitive pressure” or “costs of production” as the most pressing issues.

Chart D Availability of external financing for euro area firms

(in net percentage of fi rms that applied for external fi nancing)

-50

-40

-30

-20

-10

0

10

20

-50

-40

-30

-20

-10

0

10

20

2009 2010 2009 2010

SMEs

large firms

Bank loans Trade credit

H1 H2 H1 H2 H1 H2 H1 H2

Sources: ECB and European Commission survey on the access to fi nance of SMEs. Notes: Change over the preceding six months. Net percentages are defi ned as the difference between the percentage of fi rms reporting an increase in availability and that reporting a decrease.

Box 4

INTEGRATED EURO AREA ACCOUNTS FOR THE FOURTH QUARTER OF 20101

The integrated euro area accounts up to the fourth quarter of 2010 that were released on

3 May 2011 offer comprehensive information on the income, spending, fi nancing and portfolio

decisions of institutional sectors in the euro area. The latest data point to a continued recovery

of the euro area economy. Private consumption has remained fairly resilient so far, while

investment fl ows were less dynamic in the second half of 2010, after an initially stronger rebound

in the wake of the fi nancial crisis. The household saving rate has fallen to very low levels, while

non-fi nancial corporations (NFCs) are only gradually reverting to their traditional net borrowing.

Disintermediation has remained a salient feature of this recovery, despite signs of a partial

reversal of the earlier substitution of bank by market funding.

Euro area income and net lending/net borrowing

Nominal gross disposable income in the euro area continued to rise in the fourth quarter

of 2010, at an annual growth rate of 3%, benefi ting all sectors and, in particular, government

(see Chart A).

1 Detailed data can be found on the ECB’s website.

42ECB

Monthly Bulletin

May 2011

Euro area saving increased signifi cantly, year on year, on the back of an expansion in euro area

income that was faster than that in total consumption (marked by noticeably lower government

consumption growth), with government saving contributing the most, while household savings

continued to decline. Gross capital formation continued to expand, year on year – helped by

slower destocking – despite some moderation towards the end of the year.

With an increase in euro area saving commensurate to that of total investment, the net borrowing

of the euro area stabilised (at 0.8% of GDP, expressed as a four-quarter sum). From a sectoral

point of view, this stabilisation refl ects some further rebalancing between sectors, with another

reduction in government net borrowing (the government defi cit fell to 6% of GDP in 2010) and

a further decline in households’ net lending, while the net lending position of NFCs turned into a

small net borrowing position.2 (see Chart B).

The mirror image of these developments can be seen in the external accounts, which showed a

stable current account defi cit. On the fi nancing side, cross-border transactions expanded, with the

episode of rapidly contracting interbank deposits (between euro area MFIs and foreign banks)

coming to an end.

Behaviour of institutional sectors

Households’ nominal income growth (+1.8%, year on year) was driven mainly by rising

salaries and high property income earned in the fourth quarter of 2010, while income streams

originating from government (e.g., net social transfers and tax payments) generally contributed

2 The net lending/net borrowing of a sector is the balance of its capital account, which measures the excess of saving and net capital

transfers received over capital investments (net lending), or vice versa (net borrowing). It is also the balance of the fi nancial accounts,

which measure the difference between transactions in fi nancial assets and transactions in liabilities.

Chart A Gross disposable income in the euro area – contribution by sector

(annual percentage changes; percentage point contributions)

-5

-3

-1

1

3

5

7

-7

-5

-3

-7

-1

1

3

5

7

2000 2002 2004 2006 2008 2010

households

non-financial corporations

financial corporations

government

euro area as a whole

Sources: Eurostat and ECB.

Chart B Net lending/net borrowing of the euro area

(as a percent of GDP; four-quarter moving sum)

-8

-6

-4

-2

0

2

4

6

8

-8

-6

-4

-2

0

2

4

6

8

2000 2002 2004 2006 2008 2010

households

non-financial corporations

financial corporations

government

euro area as a whole

Sources: Eurostat and ECB.

43ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Monetary and

financial

developments

negatively. Whereas household income continued to contract in real terms, on the back of high

commodity prices, private consumption remained fairly resilient, as households chose to draw

on precautionary savings (unlike the situation in the previous episode of commodity price shocks

in 2008). Accordingly, their savings ratio declined to 13.4% on a seasonally adjusted basis,

close to the lowest level recorded over the past decade, in a context of improving employment

outlook, increasing household wealth and a rebound in some housing markets (see Chart C).

With subdued investment, households’ net lending fell markedly, and the growth of loans taken

out remained at moderate levels. On the assets side, the pattern of portfolio allocation continued

to refl ect a search for yield and an increasing risk appetite, with very small fl ows into the

low-yielding instruments included in M3 for several quarters (see Chart D).

The gross operating surplus of NFCs continued to recover on the back of solid value added

growth and despite a notably faster increase in compensation of employees. However, the

dynamic development of direct taxes paid and dividends distributed, as well as lower interest

earned, caused NFC saving to be less dynamic (and to contract somewhat, quarter on quarter,

albeit from a very high level). The net lending position of NFCs thus returned to a net borrowing

position, despite subdued NFC investment (see Chart B). The growth rate of NFCs’ external

fi nancing increased slightly, with still visible substitution effects, despite a certain slowdown in

market fi nancing (debt securities and quoted shares: +€26 billion in the second half of 2010) and

less pronounced net redemptions in MFI loans than before (-€8 billion in the second half of 2010)

(see Chart E). The ongoing deceleration of growth in market funding may partly refl ect a certain

normalisation in credit markets. At the same time, intrasector funding (trade credits, loans granted

Chart C Household income and consumption growth, and savings ratio

(annual percentage changes; percentage of gross disposable income; four-quarter moving sum)

-3

-2

-1

0

1

2

3

4

5

6

7

13.0

13.5

14.0

14.5

15.0

15.5

16.0

2000 2002 2004 2006 2008 2010

household income growth (left-hand scale)

nominal consumption growth (left-hand scale)

saving rate – seasonally adjusted (right-hand scale)

Sources: Eurostat and ECB.

Chart D Households’ financial investment

(four-quarter moving sum; percentage of gross disposable income)

-4

-2

0

2

4

6

8

10

12

14

16

-4

-2

0

2

4

6

8

10

12

14

16

other

deposits not included in M3

equity

debt securities not included in M3

mutual fund shares (other than money market

fund shares) insurance technical reserves

M3

total assets

2000 2002 2004 2006 2008 2010

Sources: Eurostat and ECB.

44ECB

Monthly Bulletin

May 2011

by NFCs, unquoted shares) still expanded rapidly, suggesting that customer-supplier relationships

continued to play a buffering role, as some companies may still be credit-constrained. After the

bankruptcy of Lehman Brothers, trade credit had contracted noticeably less than value added,

mitigating the lack of bank credit (notably for small and medium-sized enterprises) and/or poor

market access. During that period of funding stress, loans granted by NFCs (mostly intragroup

funding) had even accelerated (see Chart F). In addition, NFCs increased their liquidity buffers

substantially further (deposits but also debt securities) and stepped up their purchases of

quoted equity.

General government accounts improved further (from a peak defi cit of 6.7% in the fi rst quarter

of 2010), refl ecting the economic recovery as well as the impact of consolidation measures.

Taxes and social contributions grew year on year, while compensation of government employees

contracted on a year-on-year basis, for the fi rst time on record, and social benefi ts and interest

expenditure growth remained contained. Debt issuance increased noticeably, in parallel with a

sharp build-up of fi nancial assets, primarily on account of the operation of a specifi c German bad

bank. The defeasance structure set up for this operation in the fourth quarter of 2010 to carry the

impaired assets is classifi ed, in line with the rules of the ESA 95, as belonging to the government

sector and is seen to have incurred large liabilities to fund the acquisition of the impaired assets.

The sharp increase in fi nancial corporations’ disposable income resulted mainly from the

fact that dividends earned were higher than dividends paid, while both their value added and

Chart E External financing of non-financial corporations, by source of funds

(four-quarter moving sum; EUR billions)

-200

-100

0

100

200

300

400

500

600

700

800

-200

-100

0

100

200

300

400

500

600

700

800

unquoted equity issued minus unquoted

equity purchased

other liabilities minus other assets

quoted equities issued

debt securities issued

loans incurred net of loans granted

external financing

2000 2002 2004 2006 2008 2010

Source: Eurostat and ECB.Note: For presentational purposes, some transactions in assets are netted from fi nancing, as they are predominantly internal to the sector (loans granted by non-fi nancial corporations, unquoted shares, other accounts receivable/payable).

Chart F Loans granted by non-financial corporations and their trade credit receivable and payable

(four-quarter moving sum in EUR billions; annual percentage changes)

-200

-100

0

100

200

300

400

500

2000 2002 2004 2006 2008 2010

trade credit receivable (left-hand scale)trade credit payable (left-hand scale)

loans granted by non-financial corporations

(left-hand scale)

annual growth rate of value added (right-hand scale)

-2

3

8

13

18

-7

Sources: Eurostat and ECB.Note: trade credit receivable and payable are estimated by the ECB on the basis of partial information.

45ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Monetary and

financial

developments

their gross operating surplus contracted

year on year. Sizeable net retained earnings

(€165 billion, including net capital transfers,

in 2010), together with holding gains on

equity, compensated for valuation losses

on debt securities held (stemming from a

steepening yield curve and turmoil in some

government debt markets) and on instruments

denominated in US dollars (see Chart G).

In a context of deleveraging pressures,

additions to fi nancial corporations’ balance

sheets (excluding interbank deposits)

remained subdued, amounting to, on average,

€200 billion per quarter, compared with up

to €1.2 trillion during the preceding leverage

boom. At the same time, the previous shift

towards safer assets started to reverse.

However, the pattern of pronounced fi nancial

disintermediation that emerged after the

bankruptcy of Lehman Brothers has only

partially receded so far: households’ portfolio

allocations still favour non-monetary assets and

NFCs’ external fi nancing continues to draw

heavily on inter-company funding and on still

dynamic (although slowing) market funding.

Financial markets

On the debt securities market, the government

sector stepped up its issuance, while NFCs

reduced their recourse to the debt securities

market and MFIs continued their signifi cant net

redemptions of such liabilities. Non-monetary

fi nancial intermediaries other than insurance

corporations and pension funds (generally

referred to as “OFIs”), insurers and NFCs

added to their portfolios of debt securities held,

while households and MFIs sold such assets.

The rest of the world did not revert to the role

of a signifi cant net buyer it had played from

mid-2008 to mid-2010. On the mutual funds

market, issuance of non-money market

mutual fund shares continued at elevated

levels (in contrast to heavy redemptions in

money market mutual fund shares), refl ecting

households’ appetite for riskier and longer-term

assets. On the market for quoted shares, net

issuance moderated somewhat for both MFIs

Chart G Holding gains and losses in financial corporations’ assets

(quarterly fl ow; EUR billions)

-1,200

-1,000

-800

-600

-400

-200

0

200

400

600

800

-1,200

-1,000

-800

-600

-400

-200

0

200

400

600

800

2000 2002 2004 2006 2008 2010

other

loans

mutual funds shares

debt securities

unquoted shares

quoted shares

total

Sources: Eurostat and ECB.Note: Total refers to “other economic fl ows”, which mainly relate to (realised or unrealised) holding gains and losses (including loan write-offs).

Chart H Change in net worth of households

(four-quarter moving sum; percentage of gross disposable income)

-40

-20

0

20

40

60

-40

-20

0

20

40

60

other flows in non-financial assets 1)

other flows in financial assets and liabilities 2)

change in net worth due to net saving 3)

change in net worth

2000 2002 2004 2006 2008 2010

Sources: Eurostat and ECB.Note: Data on non-fi nancial assets are estimates by the ECB.1) Mainly holding gains and losses on real estate and land.2) Mainly holding gains and losses on shares and other equity.3) This item comprises: net saving, net capital transfers received, and the discrepancy between the non-fi nancial and the fi nancial accounts.

46ECB

Monthly Bulletin

May 2011

and NFCs. All domestic sectors again became heavy buyers: investment funds in the OFI sector,

but also MFIs, NFCs and households, while non-residents were heavy sellers. On the loan

market, NFCs slowed their continued redemption of MFI loans, in particular in the short-term

segment, while the growth of households’ borrowing remained stable.

Balance sheet dynamics

In the fourth quarter of 2010, the net worth of households continued to grow at a signifi cant

annual rate that came down to 24.6% of their income. Aside from the positive infl uence of net

saving (7.6% of income – gradually declining on the back of falling savings ratios), households

benefi ted from holding gains (17% of income) on equity, refl ecting a substantial recovery of

equity prices, year on year, up to the end of 2010, and on property. Residential property prices

have now been rising, year on year, for three quarters in a row, after six consecutive quarters of

decline (see Chart H).

47ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Prices

and costs

3 PRICES AND COSTS

According to Eurostat’s fl ash estimate, euro area annual HICP infl ation rose to 2.8% in April 2011, from 2.7% in March. The increase in infl ation rates during the fi rst four months of 2011 largely refl ects higher commodity prices. Upward pressure on infl ation, mainly from energy and commodity prices, is also discernible in the earlier stages of the production process. Risks to the medium-term outlook for price developments remain on the upside.

3.1 CONSUMER PRICES

According to Eurostat’s fl ash estimate, euro area annual HICP infl ation rose to 2.8% in April 2011,

from 2.7% in March (see Table 5). This increase was somewhat higher than expected, owing

mainly to developments in the non-energy industrial goods and unprocessed food components.

As regards energy prices, which were the main driver behind the HICP infl ation hikes in the fi rst

few months of 2011, the pass-through of the previous increases in oil prices was apparent in the

energy component of the HICP in March and was also visible in the consumer prices for liquid

fuels available from the European Commission’s weekly Oil Bulletin data for April.

In March 2011, the last month for which an offi cial breakdown is available, the annual growth rate

of overall HICP infl ation stood at 2.7%, up from 2.4% in February (see Chart 22). The increase in

the headline HICP infl ation rate in March refl ected mainly a higher annual rate of increase in the

non-energy industrial goods component. On a month-on-month seasonally adjusted basis, headline

HICP infl ation rose by 0.6% in March, compared with 0.1% in the previous month.

The annual rate of change in energy prices remained broadly unchanged at 13.0% in March,

as a result of an almost exact offsetting of two counteracting infl uences: month-on-month price

increases in all items and a strong downward base effect. The prices of liquid fuels and of fuels and

lubricants for transportation were respectively more than 30% and 15% higher than in March 2010.

The annual rate of change in unprocessed food prices declined to 2.2%, from 2.7% in February,

on account of a negative annual growth rate of prices for vegetables, whereas the annual rates

Table 5 Price developments

(annual percentage changes, unless otherwise indicated)

2009 2010 2010 2010 2011 2011 2011 2011Nov. Dec. Jan. Feb. Mar. Apr.

HICP and its componentsOverall index 1) 0.3 1.6 1.9 2.2 2.3 2.4 2.7 2.8

Energy -8.1 7.4 7.9 11.0 12.0 13.1 13.0 .

Unprocessed food 0.2 1.3 2.6 3.2 2.2 2.7 2.2 .

Processed food 1.1 0.9 1.3 1.5 1.8 2.0 2.5 .

Non-energy industrial goods 0.6 0.5 0.9 0.7 0.5 0.1 0.9 .

Services 2.0 1.4 1.3 1.3 1.5 1.6 1.6 .

Other price indicatorsIndustrial producer prices -5.1 2.9 4.5 5.4 6.0 6.6 6.7 .

Oil prices (EUR per barrel) 44.6 60.7 63.1 69.6 72.6 76.6 82.1 85.1

Non-energy commodity prices -18.5 44.7 48.6 49.6 46.0 47.5 35.7 15.2

Sources: Eurostat, ECB and ECB calculations based on Thomson Reuters data.1) HICP infl ation in April 2011 refers to Eurostat’s fl ash estimate.

48ECB

Monthly Bulletin

May 2011

of change in the prices of meat, fi sh and fruit

increased compared with the previous month.

The annual infl ation rate of processed food

increased further to 2.5%, pushed up by higher

infl ation rates for many items. Despite this rise,

it appears that the pass-through of the recent

surge in food commodity prices to the consumer

level has remained limited thus far.

Excluding all food and energy items, which

represent around 30% of the HICP basket,

annual HICP infl ation rose to 1.3% in

March, from 1.0% in February. Of the two

components of HICP infl ation excluding food

and energy, the rate of infl ation in non-energy

industrial goods rose from 0.1% in February

to 0.9% in March. This increase was driven,

inter alia, by a strong rebound in the price

of garments and footwear, which is likely an

effect of the end of the winter sales. Moreover,

the introduction of the new Regulation on

the treatment of seasonal products distorted

upwards the annual rate of change of this

component in March, after a sizeable

downward distortion in January and February

(see also Box 3 in the April 2011 Monthly

Bulletin issue). Services price infl ation

remained unchanged at 1.6%, refl ecting

broadly stable annual rates of change in the

prices of several items, including transport.

3.2 INDUSTRIAL PRODUCER PRICES

Industrial producer price infl ation (excluding

construction) rose further from 6.6% in

February to 6.7 % in March (see Table 5

and Chart 23). The annual rate of growth

in March was slightly above market

expectations, and the highest level reached

since September 2008. The increase in overall

producer price infl ation was determined mainly by the energy and the food components.

Excluding energy, it remained at 4.5%, its highest level since the mid-1990s.

The annual rate of change in industrial producer prices for consumer goods rose to 2.8%, driven

by higher food producer prices. These increased from 6.8% in February (year on year) to 7.4%

in March. Despite this further rise, the rates remain well below those recorded in 2007 and thus

continue to suggest a still incomplete pass-through of higher food commodity prices to producer and

Chart 22 Breakdown of HICP inflation: main components

(annual percentage changes; monthly data)

-3

-2

-1

0

1

2

3

4

5

-15

-10

-5

0

5

10

15

20

25

2004 2005 2006 2007 2008 2009 2010

total HICP (left-hand scale)

unprocessed food (left-hand scale)

energy (right-hand scale)

-1

0

1

2

3

4

-2

0

2

4

6

8

2004 2005 2006 2007 2008 2009 2010

total HICP excluding energy and unprocessed food

(left-hand scale)

processed food (right-hand scale)

non-energy industrial goods (left-hand scale)services (left-hand scale)

Source: Eurostat.

49ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Prices

and costs

consumer prices for food items. The annual rate of change in producer prices for consumer goods

excluding food and tobacco, which has leading indicator properties for the non-energy industrial

goods component of the HICP, increased further to 0.8% in March, after turning slightly positive

in November. This gradual upward development signals increasing domestic pipeline pressures

for underlying consumer price infl ation, which are adding to the external pressures that have been

rising steadily, as indicated by the import prices of consumer goods excluding food and tobacco.

Up to April, survey information, which is indicative of PPI developments, continues to signal very

high price pressures in the production chain (see Chart 24). The Purchasing Managers’ Index for

April 2011 confi rms the persistence of such pressures, despite some overall easing in the indices.

These pressures are reported to be due to the combined effect of higher commodity prices and

ongoing supply shortages. In the manufacturing sector, the input price index stood at 79.0 and the

selling price index at 61.0. Both indices declined from their historical highs, reached in February

and March 2011 respectively. The current levels of the indices continue to indicate that accumulated

cost increases are still to be passed on to consumer prices. In the services sector the input price

index decreased somewhat to 59.5, while the index for selling prices increased from 52.4 in March

to 53.0 in April, the highest level since August 2008.

3.3 LABOUR COST INDICATORS

Developments in labour cost indicators for the fourth quarter of 2010 remained contained.

Preliminary information on negotiated wages for January and February 2011 suggests that the

pattern of higher but still moderate wage growth has by and large continued in early 2011, in line

Chart 23 Breakdown of industrial producer prices

(annual percentage changes; monthly data)

-10

-8

-6

-4

-2

0

2

4

6

8

10

-25

-20

-15

-10

-5

0

5

10

15

20

25

2004

total industry excluding construction (left-hand scale)

intermediate goods (left-hand scale)capital goods (left-hand scale)

consumer goods (left-hand scale)energy (right-hand scale)

2005 2006 2007 2008 2009 2010

Sources: Eurostat and ECB calculations.

Chart 24 Producer input and output price surveys

(diffusion indices; monthly data)

20

30

40

50

60

70

80

90

20

30

40

50

60

70

80

90

2004 2005 2006 2007 2008 2009 2010

manufacturing; input prices

manufacturing; prices charged

services; input prices

services; prices charged

Source: Markit.Note: An index value above 50 indicates an increase in prices, whereas a value below 50 indicates a decrease.

50ECB

Monthly Bulletin

May 2011

with slight improvements in labour market

conditions. However, wage increases in 2010,

and to a large extent also in 2011, were agreed

before the recent surge in headline HICP owing

to sharp commodity price increases.

Euro area negotiated wages grew at 1.6%

year on year in the fourth quarter of 2010,

after 1.5% in the third quarter (see Table 6,

Chart 25 and Chart 26). The annual rate of

growth of hourly labour costs in the euro area

rose to 1.6% in the fourth quarter of 2010,

from 0.9% in the third quarter. This increase

was driven primarily by developments in the

industrial sector, while hourly labour costs in

other sectors such as market services grew at a

less pronounced or even negative rate, as in the

case of the construction sector.

The annual growth rate of labour productivity

per person employed declined to 1.8%, from

2.1% in the third quarter. As this annual growth

rate still exceeded that of compensation per

employee, it resulted in a year-on-year decrease in unit labour costs of 0.2%. This decline was

slightly less pronounced than that in the fi rst three quarters, when it was on average around 0.6%.

Chart 25 Selected labour cost indicators

(annual percentage changes; quarterly data)

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

2004 2005 2006 2007 2008 2009 2010

compensation per employee

negotiated wages

hourly labour cost index

Sources: Eurostat, national data and ECB calculations.Note: Data refer to the Euro 17.

Chart 26 Sectoral labour cost developments

(annual percentage changes; quarterly data)

-1

0

1

2

3

4

5

6

-1

0

1

2

3

4

5

6

2004 2005 2006 2007 2008 2009 2010

industry excluding construction, CPE

construction, CPE

market services, CPE

services, CPE

-1

0

1

2

3

4

5

6

-1

0

1

2

3

4

5

6

2004 2005 2006 2007 2008 2009 2010

industry excluding construction, hourly LCI

construction, hourly LCI

market services, hourly LCI

Sources: Eurostat and ECB calculations.Notes: Data refer to the Euro 17. CPE stands for “compensation per employee” and LCI stands for “labour cost index”.

51ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Prices

and costs

3.4 THE OUTLOOK FOR INFLATION

Looking ahead, HICP infl ation rates are likely to stay clearly above 2% over the coming months.

Upward pressure on infl ation, mainly from energy and commodity prices, is also discernible in the

earlier stages of the production process. It is of paramount importance that the rise in HICP infl ation

does not translate into second-round effects in price and wage-setting behaviour and lead to broad-based

infl ationary pressures. Infl ation expectations must remain fi rmly anchored in line with the Governing

Council’s aim of maintaining infl ation rates below, but close to, 2% over the medium term.

The latest ECB Survey of Professional Forecasters (see Box 5) shows that forecasters, compared

with the previous round, have revised upwards their outlook for infl ation in 2011 and 2012,

with infl ation expectations being within the ranges reported in the March 2011 ECB staff

macroeconomic projections for the euro area. Longer-term infl ation expectations (for 2015)

remained unchanged at 2.0%.

Risks to the medium-term outlook for price developments remain on the upside. They relate,

in particular, to higher than assumed increases in energy prices, not least on account of ongoing

political tensions in North Africa and the Middle East. More generally, strong economic growth in

emerging markets, supported by ample liquidity at the global level, may further fuel commodity price

rises. Moreover, increases in indirect taxes and administered prices may be greater than currently

assumed, owing to the need for fi scal consolidation in the coming years. Finally, risks also relate to

stronger than expected domestic price pressures in the context of the ongoing recovery in activity.

Box 5

RESULTS OF THE ECB SURVEY OF PROFESSIONAL FORECASTERS FOR THE SECOND QUARTER OF 2011

This box reports the results of the ECB Survey of Professional Forecasters (SPF) for the second

quarter of 2011. The survey was conducted between 15 and 19 April 2011 and received 55

responses. It collects information on expectations for euro area infl ation, real GDP growth and

unemployment from experts affi liated with fi nancial or non-fi nancial institutions that are based

in the EU.1

1 Given the diversity of the panel of participants, aggregate SPF results can refl ect a relatively heterogeneous set of subjective views and

assumptions.

Table 6 Labour cost indicators

(annual percentage changes, unless otherwise indicated)

2009 2010 2009 2010 2010 2010 2010Q4 Q1 Q2 Q3 Q4

Negotiated wages 2.6 1.7 2.1 1.8 1.9 1.5 1.6

Hourly labour cost index 2.9 1.5 2.0 1.9 1.6 0.9 1.6

Compensation per employee 1.5 1.7 1.5 1.7 2.1 1.5 1.6

Memo items:Labour productivity -2.3 2.2 0.1 2.2 2.6 2.1 1.8

Unit labour costs 3.8 -0.5 1.4 -0.5 -0.6 -0.6 -0.2

Sources: Eurostat, national data and ECB calculations.Note: Data refer to the Euro 17.

52ECB

Monthly Bulletin

May 2011

Infl ation expectations for 2011 and 2012

On average, infl ation is expected to be at 2.5% in 2011 and 1.9% in 2012. Compared with

the previous SPF round, forecasters have revised upwards their infl ation expectations by

0.6 percentage point for 2011 and by 0.1 percentage point for 2012 (see the table).2 According to

respondents’ comments, the substantial upward revision for 2011 is almost entirely accounted for

by the sharp rise in commodity prices, in particular energy prices. The overall upward pressure

on prices is expected to ease in the second half of 2011 and in particular in 2012. Respondents

see some upside risks in the short term through the impact of geopolitical tensions in Northern

Africa and the Middle East on oil price developments.

These expectations are within the ranges reported in the March 2011 ECB staff macroeconomic

projections. They are slightly higher for both years when compared with the corresponding

forecasts published in the April 2011 issues of Consensus Economics and the Euro Zone

Barometer.

The SPF participants were also asked to assess the probability of infl ation falling within specifi c

intervals. Compared with the previous SPF round, the aggregate probability distribution for 2011

shifted considerably towards higher outcomes (see Chart A). The highest probability (41%) is

now assigned to the range between 2.5% and 2.9%, while the interval from 2.0% to 2.4% is

assigned a 32% probability. The probability distribution for 2012 also shifted to higher outcomes

compared with the previous SPF round. Based on the individual probability distributions,

the balance of risks to the point forecasts is assessed by respondents as being on the downside

for 2011 and broadly balanced for 2012.3

2 Additional data are available on the ECB’s website at www.ecb.europa.eu/stats/prices/indic/forecast/html/index.en.html

3 The balance of risks is defi ned as being on the upside (downside) when fewer respondents report a point forecast above (below) the

mean of their probability distribution than respondents reporting a point forecast below (above) the mean.

Results of the SPF, ECB staff macroeconomic projections, Consensus Economics and the Euro Zone Barometer

(annual percentage changes, unless otherwise indicated)

Survey horizonHICP infl ation 2011 2012 Longer-term 2)

SPF Q2 2011 2.5 1.9 2.0

Previous SPF (Q1 2011) 1.9 1.8 2.0 ECB staff macroeconomic projections (March 2011) 2.0-2.6 1.0-2.4 -

Consensus Economics (April 2011) 2.4 1.8 2.1

Euro Zone Barometer (April 2011) 2.4 1.8 2.1

Real GDP growth 2011 2012 Longer-term 2)

SPF Q2 2011 1.7 1.7 1.9

Previous SPF (Q1 2011) 1.6 1.7 1.9 ECB staff macroeconomic projections (March 2011) 1.3-2.1 0.8-2.8 -

Consensus Economics (April 2011) 1.7 1.7 1.7

Euro Zone Barometer (April 2011) 1.7 1.7 1.9

Unemployment rate 1) 2011 2012 Longer-term 2)

SPF Q2 2011 9.8 9.5 8.2

Previous SPF (Q1 2011) 9.9 9.6 8.3 Consensus Economics (April 2011) 9.8 9.5 -

Euro Zone Barometer (April 2011) 9.8 9.4 8.2

1) As a percentage of the labour force.2) Longer-term expectations refer to 2015 in the Survey of Professional Forecasters, Consensus Economics and the Euro Zone Barometer.

53ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Prices

and costs

Longer-term infl ation expectations

On average, longer-term infl ation expectations (for 2015) are unchanged at 2.0% (1.96% to two

decimal places, up from 1.95% in the previous SPF round). The median forecast is also unchanged

at 2%, while the disagreement among forecasters in their longer-term infl ation expectations, as

measured by the standard deviation of their point forecasts, has fallen slightly (see Chart B). Looking

at the probability distributions for longer-term infl ation outcomes, the probability assigned to 2%

or above has on aggregate increased to 50% from 48% in the previous round. At the same time,

the standard deviation of the aggregate probability distribution, a measure of aggregate uncertainty,

has increased to an all-time high since the beginning of the survey in 1999.4

The SPF longer-term infl ation expectations are 0.1 percentage point below the longer-term

forecasts published in the April 2011 issues of Consensus Economics and the Euro Zone

Barometer (both for 2015). Measures of infl ation expectations derived from fi nancial markets

have remained somewhat higher. However, these measures incorporate not just the level of

expected infl ation, but also an additional premium to compensate bond investors for infl ation

risks. In general, they are also more volatile than survey-based measures, owing not only to

the volatility of the infl ation risk premium, but also to fl uctuations in bond market liquidity

conditions, particularly since the middle of 2008 (see Chart C).5 For these reasons, the volatility

observed in these measures should not be interpreted mechanically as refl ecting revisions in

market participants’ long-term infl ation expectations.6

4 For a discussion regarding uncertainty measures, see the box entitled “Measuring perceptions of macroeconomic uncertainty”, Monthly Bulletin, ECB, January 2010.

5 See also the article entitled “Infl ation expectations in the euro area: a review of recent developments”, Monthly Bulletin, ECB,

February 2011.

6 For further discussion on the impact of the fi nancial market crisis on market-based measures of infl ation expectations, see the box

entitled “Recent increases in real yields and their implications for the analysis of infl ation expectations”, Monthly Bulletin, ECB,

November 2008. Recent developments in fi nancial market indicators of infl ation expectations are discussed in Section 2.4 of the

Monthly Bulletin.

Chart A Probability distribution for average annual inflation in 2011 and 2012 in the latest SPF rounds 1)

(probability in percentages)

Q4 2010 SPFQ1 2011 SPFQ2 2011 SPF

a) 2011 b) 2012

0

5

10

15

20

25

30

35

40

45

0

5

10

15

20

25

30

35

40

45

≥3.5<0.4 0.5-

0.9

1.0-

1.41.5-

1.92.0-

2.42.5-

2.9

3.0-

3.4

0

5

10

15

20

25

30

35

40

45

0

5

10

15

20

25

30

35

40

45

≥3.5<0.4 0.5-

0.9

1.0-

1.41.5-

1.92.0-

2.42.5-

2.9

3.0-

3.4

Source: ECB.1) Corresponds to the average of individual probability distributions provided by SPF forecasters.

54ECB

Monthly Bulletin

May 2011

Real GDP growth expectations

Real GDP growth expectations in the SPF for 2011 have been revised upwards by 0.1 percentage

point and stand now at 1.7%. Growth expectations for 2012 remained unchanged at 1.7%.

These expectations are within the ranges reported in the March 2011 ECB staff macroeconomic

projections and are identical to the latest Consensus Economics and Euro Zone Barometer

forecasts for 2011 and 2012 (see the table).

According to forecasters’ comments, the upward revision in 2011 was supported mainly

by higher domestic activity at the beginning of the year in some larger euro area economies,

particularly in Germany.

In line with the upward revision of expected real GDP growth in 2011, the aggregate probability

distribution for 2011 has shifted noticeably towards higher outcomes. Respondents now assign a

44% probability to the outcomes between 1.5% and 1.9%, while the probability assigned to the

interval from 1.0% to 1.4% has decreased to 20%. With respect to 2012, the aggregate probability

distribution has marginally shifted downwards, but is still concentrated in the interval between

1.5% and 1.9%, which is assigned a probability of 37% (see Chart D).

Based on the individual probability distributions, the balance of risks to the point forecasts is

assessed to be on the downside for both 2011 and 2012. The key downside risks to the GDP

growth outlook are reported to be a higher than expected impact of fi scal tightening, mostly in

the fi scally distressed euro area countries, a continuing rise in energy prices eroding households’

purchasing power, and a possible deceleration in global growth, particularly in the emerging

economies.

Chart B Longer-term inflation point forecasts of the SPF respondents 1)

(annual percentage changes)

1.5

1.6

1.7

1.8

1.9

2.0

2.1

2.2

2.3

1.5

1.6

1.7

1.8

1.9

2.0

2.1

2.2

2.3

range between 25th and 75th percentiles

range between 10th and 90th percentiles

median of the point forecasts

2004 2005 2006 2007 2008 2009 2010

Source: ECB.1) “Longer-term” refers to 2015 for the current round of the SPF.

Chart C Longer-term inflation expectations from surveys and break-even inflation rates

(average annual percentage changes; fi ve-day moving averages of daily data)

1.6

1.7

1.8

1.9

2.0

2.1

2.2

2.3

2.4

2.5

2.6

2.7

2.8

2.9

2001 2002 2003 2005 2006 2007 2008 2009 20102004

1.6

1.7

1.8

1.9

2.0

2.1

2.2

2.3

2.4

2.5

2.6

2.7

2.8

2.9

SPF (five years ahead)

Consensus Economics (five years ahead)

Euro Zone Barometer (five years ahead)

implied five-year forward break-even inflation rate

five years ahead, seasonally adjusted

Sources: Bloomberg, Consensus Economics, EuroMTS, Euro Zone Barometer, Thomson Reuters and ECB calculations.

55ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Prices

and costs

The SPF longer-term growth expectations (for 2015) remain stable at 1.9%. The SPF assessment

is in line with that of the latest issue of the Euro Zone Barometer and 0.2 percentage point higher

than that of the latest Consensus Economics forecasts. The balance of risks to longer-term growth

forecasts obtained by comparing the individual probability distributions and point forecasts is on

the downside.

Expectations for the euro area unemployment rate

Unemployment rate expectations have been slightly revised downwards by 0.1 percentage point

for both 2011 and 2012, to 9.8% and 9.5% respectively. Based on the individual probability

distributions, the balance of risks to these forecasts is assessed to be on the downside for 2011

and on the upside for 2012. Longer-term unemployment rate expectations (for 2015) have been

slightly revised downwards by 0.1 percentage point to 8.2% compared with the previous round

and the balance of risks to the longer-term outlook is assessed to be on the upside.

Other variables and conditioning assumptions

According to other information provided by the respondents, they generally expect: (i) oil prices

to stand at around USD 115 per barrel in the second quarter of 2011 and then slightly decrease

to an average of USD 110 per barrel in 2012; (ii) average annual wage growth to be at 1.8%

in 2011, rising gradually to 2.4% in 2015; (iii) the euro/dollar exchange rate to reach 1.39 in the

second quarter of 2011 and then to slightly depreciate to 1.37 in the fi rst quarter of 2012; and

(iv) the ECB main refi nancing rate to increase gradually from around 1.3% in the second quarter

of 2011 to around 1.9% in the fi rst quarter of 2012, and then to 2.2% on average in 2012.

Chart D Probability distribution for average annual real GDP growth in 2011 and 2012 in the latest SPF rounds 1)

(probability in percentages)

Q4 2010 SPF

Q1 2011 SPF

Q2 2011 SPF

a) 2011 b) 2012

0

5

10

15

20

25

30

35

40

45

0

5

10

15

20

25

30

35

40

45

≥3.5<0.0 0.0-

0.4

0.5-

0.9

1.0-

1.4

1.5-

1.9

2.0-

2.4

2.5-

2.9

3.0-

3.4

0

5

10

15

20

25

30

35

40

45

0

5

10

15

20

25

30

35

40

45

≥3.5<0.0 0.0-

0.4

0.5-

0.9

1.0-

1.4

1.5-

1.9

2.0-

2.4

2.5-

2.9

3.0-

3.4

Source: ECB.1) Corresponds to the average of individual probability distributions provided by SPF forecasters.

56ECB

Monthly Bulletin

May 2011

Output in the euro area has continued to rise since the third quarter of 2009. Following the 0.3% quarter-on-quarter increase in euro area real GDP in the fourth quarter of 2010, recent statistical releases and survey-based indicators point towards a continued positive underlying momentum of economic activity in the euro area during the fi rst quarter of 2011 and at the beginning of the second quarter.

Looking ahead, euro area exports should be supported by the ongoing expansion in the world economy. At the same time, taking into account the high level of business confi dence in the euro area, private sector domestic demand should contribute increasingly to economic growth, benefi ting from the accommodative monetary policy stance and the measures adopted to improve the functioning of the fi nancial system. However, activity is expected to continue to be dampened somewhat by the process of balance sheet adjustment in various sectors. The risks to this economic outlook remain broadly balanced in an environment of elevated uncertainty.

4.1 REAL GDP AND DEMAND COMPONENTS

Real GDP in the euro area rose by 0.3% in the

fourth quarter of 2010, following an increase

of 0.4% in the third quarter (see Chart 27).

Meanwhile the annual rate of change in the

fourth quarter stood at 2.0%. This is the same

rate as in the two previous quarters and higher

than the average increase since 1996, which

is 1.7%.1 In 2010 as a whole euro area real

GDP increased by 1.8%. In this context, Box 6

presents indicators with the aim of describing

and forecasting the euro area business cycle

from a qualitative perspective, which point to

ongoing positive cyclical developments in the

euro area.

Private consumption increased by 0.4% quarter

on quarter in the fourth quarter of 2010. With

regard to the fi rst quarter of 2011, available

information points towards positive but muted

quarter-on-quarter growth in consumer spending.

Retail sales declined by 1.0% month on month

in March, leading to a quarterly decline of 0.1% for the fi rst quarter as a whole (see Chart 28).

Despite the quarterly contraction, this is still an improvement compared with the last quarter of

2010 when retail sales declined by 0.3%. At the same time new passenger car registrations rose

by 1.8% in the fi rst quarter of 2011, following a strong increase in the previous quarter of 6.8%.

Retail sector survey data for April 2011 are consistent with positive, albeit limited, growth in retail

sales at the beginning of the second quarter. Furthermore, the indicators on consumer confi dence

and expected major purchases, published by the European Commission, remained broadly stable

in the fi rst quarter of 2011, before displaying a small decline in April. The latter indicator remains

at low levels, which suggests that consumers remain cautious.

1 Euro area quarterly national accounts, as published by Eurostat, are only available from the fi rst quarter of 1995.

4 OUTPUT, DEMAND AND THE LABOUR MARKET

Chart 27 Real GDP growth and contributions

(quarter-on-quarter growth rate and quarterly percentage point contributions; seasonally adjusted)

Q4 Q1 Q2 Q3 Q4

domestic demand (excluding inventories)

changes in inventories

net exportstotal GDP growth

2009 2010

1.2

0.8

0.4

0.0

-0.4

1.2

0.8

0.4

0.0

-0.4

Sources: Eurostat and ECB calculations.Note: Data refer to the Euro 17.

57ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Output,

demand and the

labour market

Box 6

THE MEASUREMENT AND PREDICTION OF THE EURO AREA BUSINESS CYCLE

Accurate information on the current and future state of the business cycle is a valuable input into

the decision-making process of policy-makers and businesses. For this reason various academic,

commercial, government and policy institutions use coincident and leading business cycle

indicators as instruments to measure and predict business cycle developments. These indicators

all aim at describing and forecasting the business cycle, but differ in terms of the methodology

applied and the choices made regarding the concept used for the identifi cation of the cyclical

pattern; the variables selected and their lead times; and the weighting of the series used to

compile a single index. For example, the Conference Board and the Organisation for Economic

Co-operation and Development (OECD) calculate business cycle indicators for the euro area.1

Based on coincident and leading business cycle indicators recently developed by ECB staff, this box

illustrates how such indicators can be used to measure and predict the euro area business cycle.2

Measurement

A common way to measure the business cycle is by using the concept of the deviation or

growth cycle. This approach defi nes the business cycle as cyclical fl uctuations in overall

economic activity around its long-term trend. Using the OECD terminology, four phases of the

deviation cycle can be distinguished: i) expansion: economic activity is above the trend level and

the cycle is upward sloping, i.e. the level of economic activity is growing faster than the trend;

ii) downturn: economic activity is above the trend, but deteriorating; iii) slowdown: economic

activity is below the trend and the cycle is

downward sloping, which ends in a business

cycle trough; iv) recovery: economic activity is

below the trend, but improving (see Chart A).

Chart B plots deviation cycles in the euro

area derived from real GDP and industrial

production excluding construction by applying

a one-sided band pass fi lter. It shows the

percentage deviation of these two cyclical

components from their corresponding trends.

In this representation developments in the

cyclical deviation from trend may arise

from changes in the strength of growth in

both the cyclical component and the trend

component. For instance, rises in such

indicators represent a strengthening of

growth in the cyclical component relative

to the trend component and could be due

to a strengthening of growth in the cyclical

1 For more information on the Conference Board indicators and the OECD indicators, see http://www.conference-board.org/data/bci.cfm

and http://www.oecd.org/dataoecd/22/47/44728410.pdf respectively.

2 For more details, see de Bondt, G. and Hahn, E., “Predicting recessions and recoveries in real time: the euro area-wide leading indicator

(ALI)”, Working Paper Series, No 1246, ECB, Frankfurt am Main, September 2010.

Chart A Stylised business cycle phases

(percentage deviation from trend)

-1.00

-0.75

-0.50

-0.25

0.00

0.25

0.50

0.75

1.00

-1.00

-0.75

-0.50

-0.25

0.00

0.25

0.50

0.75

1.00

time

expansion downturn

slowdown recovery

Source: ECB calculations.

58ECB

Monthly Bulletin

May 2011

component or to a weakening of trend growth. The chart shows that the business cycle

indicator based on industrial production excluding construction is very similar to the cycle

derived from real GDP. This suggests that the fi rst indicator, for which data are available

on a monthly and more timely basis (production data are released with a 1½-month

delay, whereas real GDP data are only available at a quarterly frequency and are released

1½ months after the end of the quarter to which they relate), is able to track developments in

overall economic activity well and can therefore be used as a coincident business cycle indicator

for the euro area. Chart B also highlights the fact that these two business cycle indicators typically

peak before the start of recessions in the euro area, as dated by the Centre for Economic Policy

Research (CEPR), and reach a trough around the end of these periods.3 These features underline

the relevance of these deviation cycle indicators.

Prediction

Using the monthly business cycle indicator derived from industrial production excluding

construction as a reference for the euro area business cycle, a euro area-wide leading indicator (ALI)

that aims to predict movements in this business cycle indicator well in advance has been developed.

The ALI is derived as a composite index of a number of leading series, which are carefully selected

from a large pool of data that have shown a comparatively strong and stable lead with respect to

the indicator derived from industrial production excluding construction. Moreover, emphasis is

put on ensuring that a broad economic mixture of leading series is used to derive the ALI in order

3 The CEPR business cycle dating refers, in contrast to the derived business cycle indicators, to the concept of the classical business

cycle, which defi nes the business cycle in terms of the level of economic activity. A comparison of the results is nevertheless useful,

as the CEPR dating is probably the most widely used business cycle dating for the euro area and there is a close link between the

classical and deviation cycle developments (see Marcellino, M. (2006), “Leading indicators”, in Elliott, G., Granger, C.W.G. and

Timmerman, A. (eds.), Handbook of Economic Forecasting, Elsevier, Vol. 1, Chapter 16, pp. 879-960).

Chart B Euro area business cycle indicators derived from industrial production (excluding construction) and real GDP

(percentage deviation from trend; standardised, quarterly data)

-3

-2

-1

0

1

2

3

-3

-2

-1

0

1

2

3

1970 1973 1976 1979 1982 1985 1988 1991 1994 1997 2000 2003 2006 2009

CEPR dated recessions CEPR dated slow growth period

industrial production excluding construction cycle

real GDP cycle

Sources: ECB, Eurostat, the euro area-wide model database and ECB calculations. Notes: The horizon of the indicator based on real GDP extends to the fourth quarter of 2010 and that of the indicator based on industrial production excluding construction extends to the fi rst quarter of 2011. For the fi rst quarter of 2011 the latter indicator is based on data for January and February only. The indicators are derived by applying a one-sided band pass fi lter.

59ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Output,

demand and the

labour market

to guarantee that information on different parts of the economy and from different data sources

is exploited, which should also help to enhance the robustness of the ALI. It is calculated as the

unweighted average of nine leading series, all of which are measured as the percentage deviation

from trend and are shifted when included in the composite index according to their respective lead

times. These series are the ten-year government bond yield, the stock price index, real M1, building

permits granted, consumer confi dence, the economic sentiment indicator, the manufacturing new

orders/stocks ratio obtained from the Purchasing Managers’ Survey, the US unemployment rate

and the Institute for Economic Research (Ifo) business expectations indicator for Germany.4

The ALI projects the development of the business cycle indicator derived from industrial

production excluding construction fi ve months ahead and, since the series included in the index

have earlier release times than data on industrial production, it effectively leads the industrial

production-based business cycle indicator by six months.5

Chart C plots the development of the monthly business cycle indicator derived from industrial

production excluding construction together with that of the ALI.6 The chart underlines the fact

that the ALI generally accurately leads the industrial production cycle and signals cyclical turning

points before and after euro area recessions.7 With regard to the latest cyclical developments, the

4 The leading properties of the expectations reported in a survey of around 7,000 businesses in Germany for the euro area business cycle

are probably largely due to Germany’s considerable importance as a motor for the euro area economy given its size and the high share

of the manufacturing sector in total value added in Germany compared with other euro area countries. The article entitled “Predictive

power of leading indicators for euro area GDP growth” in the June 2008 Quarterly Bulletin of De Nederlandsche Bank shows that

the Ifo business expectations indicator for Germany appears to be the best predictor for euro area real GDP growth out of a set of

130 series.

5 By successively dropping series with the shortest lead times from the overall composite index, indicators with even longer lead times

can be derived, but at the cost of declining reliability.

6 The industrial production cycle shown in Chart C may deviate from that plotted in Chart B, because Chart B is based on monthly rather

than quarterly data and uses data as of January 1960.

7 An analysis for the period 2007 to 2009 shows that the indicators signalled the latest trough and upturn well in real time

(see the reference cited in footnote 2).

Chart C Euro area business cycle indicator derived from industrial production (excluding construction) and the euro area-wide leading indicator (ALI)

(percentage deviation from trend; standardised, monthly data)

-3

-2

-1

0

1

2

3

-3

-2

-1

0

1

2

3

1970 1973 1976 1979 1982 1985 1988 1991 1994 1997 2000 2003 2006 2009

industrial production excluding construction cycle

ALI

CEPR dated recessions CEPR dated slow growth period

Sources: Thomson Reuters, ECB, European Commission, Eurostat, Ifo Institute for Economic Research, Markit, US Department of Labor and ECB calculations. Note: The latest observation for the industrial production cycle refers to February 2011 and the latest observation for the ALI refers to March 2011.

60ECB

Monthly Bulletin

May 2011

Gross fi xed capital formation decreased by

0.5% quarter on quarter in the fourth quarter of

2010, following a fall of 0.2% in the previous

quarter. This decline is entirely due to weak

developments in construction investment

(in part owing to the cold weather in December),

as non-construction investment increased in the

fourth quarter.

Available indicators provide positive signals

for investment growth in the euro area in early

2011. While construction production declined

by 0.9% in February, the strong rise of 4.0% in

January implies that it nonetheless stood above

the average level recorded in the fourth quarter

of 2010. Furthermore, the Purchasing Managers’

Index (PMI) for construction in the euro area rose

above 50 in the fi rst quarter of 2011, the highest

level recorded since the beginning of 2007.

At the same time the indicator on construction

confi dence, published by the European

Commission, increased slightly in the fi rst

quarter of 2011. Industrial production of capital

business cycle indicator derived from industrial production excluding construction returned to

an expansion phase around the turn of this year, a move that had been consistently predicted by

the ALI. This movement to an expansion phase is also consistent with the latest developments

in the capacity utilisation rate in the euro area, which returned to its long-term average in April.

Looking ahead, the ALI projects ongoing positive cyclical developments in the euro area at

a stabilising or slightly declining rate over the lead horizon of the index (until August 2011).

A similar business cycle outlook for the near term emerges from the latest Conference Board

and OECD composite leading indicators. In this context, it is important to note that the ALI is

designed to predict the direction of and, in particular, turning points in the euro area business

cycle. The ALI is, hence, a qualitative indicator for the euro area business cycle which is one of

the main differences from short-term GDP forecasting tools,8 which are quantitative in nature.

All in all, the business cycle indicator derived from industrial production excluding construction

provides useful information on a monthly basis for identifying cyclical developments in euro

area real GDP at an early stage, and the ALI is useful for signalling the future direction of and

turning points in the euro area business cycle six months ahead. Such qualitative business cycle

indicators are used in the internal analysis of ECB staff with a view to providing information

which complements data from other sources, including quantitative short-term GDP forecasting

tools. It must also be kept in mind that the focus of the deviation cycle approach is on

developments in the cyclical component vis-à-vis those in the trend, both of which are measured

with considerable uncertainty. In addition, some of the underlying series used in this approach

are subject to revisions over time, and historical relationships and average lead times could

change, for instance owing to structural changes in the economy.

8 See e.g. the article entitled “Short-term forecasts of economic activity in the euro area”, Monthly Bulletin, ECB, April 2008.

Chart 28 Retail sales and confidence in the retail trade and household sectors

(monthly data)

-3

-2

-1

0

1

2

3

4

-30

-20

-10

0

10

20

30

40

2004 2005 2006 2007 2008 2009 2010

total retail sales 1) (left-hand scale)

consumer confidence 2) (right-hand scale)

retail confidence 2) (right-hand scale)

Sources: European Commission Business and Consumer Surveys and Eurostat.1) Annual percentage changes; three-month moving averages; working day-adjusted. Excludes fuel.2) Percentage balances; seasonally and mean-adjusted.

61ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Output,

demand and the

labour market

goods, an indicator of future non-construction investment, grew by 1.0% in February to stand 2.4%

above the average level recorded in the fourth quarter of 2010. Survey data on the industrial sector

excluding construction (both the PMI output index and the industrial confi dence indicator published

by the European Commission), which improved in the fi rst quarter of 2011, remained strong in April.

In addition, capacity utilisation has been rising since mid-2009, according to European Commission

surveys, and in April it stood at a level only slightly below its long-term average. The number of

respondents reporting insuffi cient demand as a factor limiting production has declined noticeably

over this period, while the infl uence of supply-side constraints resulting from a lack of equipment

or labour shortages has grown. Finally, the spring 2011 European Commission investment survey,

which is conducted on a biannual basis, shows an improvement in investment plans for 2011,

revealing that fi rms plan to invest almost 10% more this year than they did in 2010.

With regard to trade fl ows, extra-euro area imports continued to expand strongly in February,

while extra-euro area exports showed clear signs of improvement. In the fi rst two months of

2011 the value of both extra-euro area imports and exports of goods grew at a faster pace, on

average, than in the fourth quarter of 2010. According to balance of payments data available up

to February, extra-euro area imports and exports of goods and services grew at faster rates in

three-month-on-three-month terms (see Box 7 for more details on euro area trade in services). Recent

data and surveys suggest that euro area trade continued to grow at the beginning of the second

quarter of 2011. With global activity and foreign demand for euro area exports remaining strong, a

further expansion in euro area exports is likely in the near term. The PMI for new export orders in

the euro area manufacturing sector remained well above the expansion/contraction threshold of 50

in the fi rst quarter of 2011. It rose slightly to 57.7 in April, pointing towards continued growth in

euro area exports at the beginning of the second quarter.

Box 7

EURO AREA TRADE IN SERVICES: SPECIALISATION PATTERNS AND RECENT TRENDS

This box describes the main trends in euro area cross-border trade in services in terms

of economic importance and patterns of specialisation. The euro area is the largest exporter of

services worldwide, accounting for almost one-quarter of total world exports of services. Trade in

services tends to play a greater role in small euro area countries with large defi cits in trade in goods.

During the latest economic downturn trade in services was more resilient than trade in goods.

Nevertheless, the effects of the recession were highly heterogeneous across different services

sub-sectors.

Extra-euro area trade in services

Services represent the bulk of economic activity in all advanced economies. In 2010 their shares

of euro area GDP and employment were 66% and 73% respectively.1 Owing in particular to

the non-transportability of many services, the importance of services in the domestic economy

is not refl ected in international trade fl ows. In 2010 services represented only 25% of total

extra-euro area exports and 24% of total extra-euro area imports, with a positive services trade

balance of 0.4% of GDP. Compared with demand for manufactured goods, and in particular

1 Unless otherwise specifi ed, all data refer to the 16-country composition of the euro area.

62ECB

Monthly Bulletin

May 2011

for durables, the demand for a range of

traded services appears to be less cyclical;

services trade and production seem to be less

dependent on external fi nance, as suggested

by developments during the recent recession

episode (see Chart A). In the second quarter of

2009 total trade in goods contracted by 20%

compared with the level recorded in the second

quarter of 2008, while total trade in services

declined by 8.7% in the same period. The

developments in early 2010 when the recovery

in trade in goods was much stronger than that

in trade in services can be seen as unwinding

those that took place in 2009.

In nominal terms, the euro area is the largest

exporter of services worldwide. In 2009

extra-euro area exports accounted for 23% of

global trade in services. The United States was

the second largest exporter (16%), followed

by the United Kingdom (8.1%), Japan (4.4%),

China (4.4%) and India (3.1%). Looking at the

last decade, the euro area export share increased from 20% in 2000 to 23% in 2004 and stabilised

thereafter. By contrast, the United States experienced a sizeable decline in its market share. This

could refl ect in part valuation effects derived from the weakening of the US dollar, as well as

the increasing role of emerging economies, such as China and India. Market size and cultural

and linguistic ties are the main determinants of the direction of services trade fl ows. The euro

area’s main trading partners are the United Kingdom and the United States (see Table A). Both

markets have become less important in the last

few years, to the advantage of other European

countries and the emerging economies.

The export specialisation of the euro

area is quite balanced across services and

manufacturing (see Chart B).2 This is in

sharp contrast to the specialisation patterns

of the euro area’s main trading partners. For

instance, both the United Kingdom and the

United States appear to specialise in insurance

and fi nancial services, and India exhibits a

specialisation in computer, information and

2 Chart B is based on the Balassa index, which is a measure of revealed comparative advantage. For country c and sector i, the index

value is computed as:xci /XcXi / X

, where the numerator represents the share of sector i in the total exports of country c, and the denominator

represents the sector’s share in world exports. A value greater than 1 indicates that a country specialises in exports in a given sector,

as it implies that the share of the sector in the country’s exports is higher than the share of the same sector in world exports. Conversely,

an index value of less than 1 indicates that a country lacks a specialisation in the given sector.

Chart A Extra-euro area trade in goods and services

(year-on-year percentage growth rates)

-30

-20

-10

0

10

20

30

-30

-20

-10

0

10

20

30

goods services

Mar. Sep.Sep. Mar. Sep.Mar. Sep.Mar.2007 2008 2009 2010

Sources: ECB data and calculations.

Table A Geographical breakdown of extra-euro area trade in servicesin 2010

(percentages)

Trading partner Exports Imports

United Kingdom 20.3 16.5

United States 14.7 19.2

Other EU countries 10.4 10.1

Switzerland 10.1 8.5

China 3.0 2.4

Japan 2.4 1.9

Other countries 39.1 33.5

Source: ECB.

63ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Output,

demand and the

labour market

other business services, while China has a marked specialisation in manufacturing.3 A closer

look at the services sector trade balance reveals that the euro area surplus is mainly driven by

computer, information and other business services, fi nancial services and transport services. By

contrast, the euro area is a net importer of royalties and licence fees and of personal, cultural

and recreational services. Over the period 2004-09 only imports of insurance services fell.

Conversely, during the same period exports of travel, personal and cultural services contracted

slightly. These declines were in part driven by the effects of the crisis; over the period 2008-09

imports and exports of travel, transport and fi nancial services recorded the sharpest contractions.

Euro area countries’ trade in services

The patterns of specialisation within the services sector are quite heterogeneous across euro area

countries. Some exhibit a clear specialisation in one or a few sectors: Cyprus and Luxembourg

in fi nancial services; Finland in computer and information services; Greece in transport services;

and Ireland in insurance services and computer and information services. Other countries

have a more balanced pattern of trade in services, with a slight dominance in one sub-sector:

travel services in Austria, France, Italy, Portugal, Slovenia and Spain; communication services

in Belgium and the Netherlands; construction services in Germany; and personal and cultural

services in Slovakia.

3 Other business services include merchanting and trade-related services, operational leasing services and miscellaneous business,

professional and technical services, for instance legal, accounting, research and development, and advertising services.

Chart B Export specialisation in goods and services sectors in 2007-09

(Balassa index of revealed comparative advantage; relative to the rest of the world)

Euro area and other developed economies Euro area and emerging economies

Computer,

information

and other

business services

Agricultural

raw materials

Food

Fuel

Insurance and

financial services

Transport

services

Ores

and

metals

Manufacturing

Travel services

0.0

0.5

1.0

1.5

2.0

2.5

euro area

Japan

United Kingdom

United States

0.0

0.5

1.0

1.5

2.0

2.5 Agricultural raw

materials

Food

Fuel

Insurance and

financial services

Transport

services

Manufacturing

Travel services

euro area

China

India

Computer,

information

and other

business services

Ores

and

metals

Sources: Eurostat, World Development Indicators database and ECB calculations.Notes: Data are averages for the period 2007-09. The United Kingdom and United States Balassa index values for insurance and fi nancial services are 6.7 and 2.6 respectively. The India Balassa index value for computer, information and other business services is 2.9.

64ECB

Monthly Bulletin

May 2011

4.2 OUTPUT, SUPPLY AND LABOUR MARKET DEVELOPMENTS

Real value added increased by 0.3% quarter on quarter in the third and fourth quarters of 2010. Real

value added in industry (excluding construction) and services grew by 1.1% and 0.3% respectively,

while construction value added contracted by 1.2%, the latter sector being infl uenced by the

unusually cold weather conditions in December.

With regard to developments in the fi rst quarter of 2011, industrial production excluding construction

increased by 0.5% in February, following a rise of 0.2% in January (see Chart 29). The average

level during the fi rst two months of the fi rst quarter was 1.1% above the average level recorded in

the fourth quarter of 2010. Industrial new orders (excluding heavy transport equipment) rose by

0.8% month on month in February, following a rise of 2.6% in January, to stand some 5% higher

than in the fourth quarter of 2010. More timely information from surveys also suggests favourable

Trade in services plays a greater role in small economies, such as Cyprus, Luxembourg and Malta,

owing possibly to the tendency of small economies to specialise in fi nancial services or tourism

(see Table B). Looking at net trade, big surpluses in trade in services tend to counterbalance large

defi cits in the goods balance. This is the case for Greece, Cyprus, Luxembourg, Malta and Portugal.

The importance of services in the domestic economy is only partially refl ected in international

trade fl ows. Nevertheless, over the last decade the relative importance of services trade with

respect to total trade has increased for the euro area as a whole and for all the euro area countries

except the Netherlands. This is also refl ected in the increasing weight of services trade in GDP.

The contribution of trade in services to GDP is particularly important for small economies with

large negative defi cits in trade in goods. This underlines the importance of taking into account

the role of trade in services when assessing international competitiveness.

Table B Euro area trade in goods and services in 2009

(percentages of GDP)

Goods ServicesExports Imports Net Exports Imports Net

Belgium 78.9 74.8 4.1 16.9 15.7 1.2

Germany 33.4 27.8 5.6 6.8 7.6 -0.8

Ireland 50.7 27.3 23.4 42.6 45.4 -2.8

Greece 6.0 18.0 -12.0 11.4 5.9 5.5

Spain 14.9 19.9 -4.9 8.4 5.9 2.4

France 17.9 20.8 -2.9 5.4 4.8 0.6

Italy 19.2 19.4 -0.2 4.8 5.5 -0.7

Cyprus 1) 6.6 42.7 -36.2 47.3 19.5 27.8

Luxembourg 39.8 46.3 -6.5 115.9 68.7 47.2

Malta 2) 43.7 67.4 -23.6 41.2 27.4 13.8

Netherlands 63.0 56.3 6.7 11.5 10.7 0.8

Austria 35.6 37.4 -1.8 13.7 9.6 4.0

Portugal 18.9 30.4 -11.4 9.9 6.2 3.7

Slovenia 54.1 54.2 -0.2 12.4 9.3 3.2

Finland 26.3 25.2 1.1 10.8 9.9 0.9

Euro area 3) 28.6 27.9 0.6 9.0 8.2 0.8

Sources: World Development Indicators database and ECB calculations.1) The latest available data are for 2008.2) The latest available data are for 2007.3) The euro area data have been calculated on the basis of total euro area imports and exports (the sum of intra and extra-euro area trade for the countries listed in the table).

65ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Output,

demand and the

labour market

developments in activity in the fi rst quarter of 2011 and at the beginning of the second quarter. The

PMI output index for the manufacturing sector and the PMI for business activity in services both

rose in the fi rst quarter of 2011, remaining at levels well above the expansion/contraction threshold

of 50. The results of the PMI surveys remained strong in April, which bodes well for developments

in activity in the second quarter of 2011. Other business surveys, such as those of the European

Commission, are broadly in line with developments in the PMI (see Chart 30).

LABOUR MARKET

Conditions in the euro area labour markets have shown signs of improvement. Employment rose by

0.2% in the last quarter of 2010, following zero growth in the previous quarter. At the sectoral level,

employment in services and agriculture increased in the fourth quarter of 2010, while employment

in industry including construction declined (see Table 7 and Chart 31). Growth in hours worked

was more subdued than employment growth in the fourth quarter.

Growth in euro area output, together with the cyclically lagged labour market developments,

contributed to positive growth in productivity throughout 2010. In year-on-year terms, aggregate

euro area productivity per person employed grew by 1.8% in the fourth quarter of 2010,

Chart 29 Industrial production growth and contributions

(growth rate and percentage point contributions; monthly data; seasonally adjusted)

-11

-10

-9

-8

-7

-6

-5

-4

-3

-2

-1

0

1

2

3

4

-11

-10

-9

-8

-7

-6

-5

-4

-3

-2

-1

0

1

2

3

4

2004 2005 2006 2007 2008 2009 2010

capital goods

consumer goods

intermediate goods

energy

total (excluding construction)

Sources: Eurostat and ECB calculations.Notes: Data shown are calculated as three-month moving averages against the corresponding average three months earlier.

Chart 30 Industrial production, industrial confidence and the PMI

(monthly data; seasonally adjusted)

-15

-10

-5

0

5

-45

-40

-35

-30

-25

-20

-15

-10

-5

0

5

10

15

industrial production 2) (left-hand scale)

industrial confidence 2) (right-hand scale)

PMI 3) (right-hand scale)

2004 2005 2006 2007 2008 2009 2010

Sources: Eurostat, European Commission Business and Consumer Surveys, Markit and ECB calculations.Notes: Survey data refer to manufacturing.1) Three-month-on-three-month percentage changes.2) Percentage balances.3) Purchasing Managers’ Index; deviations from an index value of 50.

66ECB

Monthly Bulletin

May 2011

while productivity per hour worked rose by 1.3% (see Chart 32). Regarding sectoral developments,

productivity increased strongly in industry excluding construction, while rising more gradually in

the services sector.

More recent data on the labour market show that the unemployment rate stood at 9.9% in March,

unchanged from the previous month, despite a small decline in the number of unemployed people

compared with February (see Chart 33). Survey indicators point towards continued positive

employment growth in the fi rst quarter of 2011 and at the beginning of the second quarter, in

industry as well as in services.

Table 7 Employment growth

(percentage changes compared with the previous period; seasonally adjusted)

Persons Hours

Annual rates Quarterly rates Annual rates Quarterly rates

2009 2010 2010 2010 2010 2009 2010 2010 2010 2010Q2 Q3 Q4 Q2 Q3 Q4

Whole economy -1.9 -0.5 0.1 0.0 0.2 -3.3 0.4 0.4 0.2 0.0

of which:Agriculture and fi shing -2.4 -0.6 -1.0 0.1 0.4 -2.7 -1.0 0.1 -0.1 -0.1

Industry -5.7 -3.3 -0.2 -0.5 -0.3 -8.8 -1.3 0.6 0.2 -0.5

Excluding construction -5.3 -3.1 -0.1 -0.3 0.0 -9.0 -0.3 0.8 0.7 0.1

Construction -6.7 -3.7 -0.3 -1.1 -0.9 -8.3 -3.2 0.0 -0.9 -1.6

Services -0.5 0.5 0.3 0.1 0.3 -1.3 1.0 0.4 0.3 0.2

Trade and transport -1.8 -0.7 0.0 0.1 0.3 -2.7 0.2 0.3 0.0 -0.1

Finance and business -2.1 1.0 0.9 0.2 0.3 -3.2 1.5 0.7 0.5 0.3

Public administration 1) 1.4 1.2 0.2 0.2 0.3 1.2 1.5 0.2 0.4 0.3

Sources: Eurostat and ECB calculations.Note: Data refer to the Euro 17.1) Also includes education, health and other services.

Chart 31 Employment growth and employment expectations

(annual percentage changes; percentage balances; seasonally adjusted)

-7

-6

-5

-4

-3

-2

-1

0

1

2

3

-70

-60

-50

-40

-30

-20

-10

0

10

20

30

2004 2005 2006 2007 2008 2009 2010

employment growth in industry

excluding construction (left-hand scale)

employment expectations in manufacturing

(right-hand scale)

-25

-20

-15

-10

-5

0

5

10

15

20

25

-25

-20

-15

-10

-5

0

5

10

15

20

25

employment expectations in construction

employment expectations in the retail tradeemployment expectations in the services sector

2004 2005 2006 2007 2008 2009 2010

Sources: Eurostat and European Commission Business and Consumer Surveys.Notes: Data refer to the Euro 17. Percentage balances are mean-adjusted.

67ECB

Monthly Bulletin

May 2011

ECONOMIC AND MONETARYDEVELOPMENTS

Output,

demand and the

labour market

4.3 THE OUTLOOK FOR ECONOMIC ACTIVITY

Looking ahead, euro area exports should be supported by the ongoing expansion in the world

economy. At the same time, taking into account the high level of business confi dence in the

euro area, private sector domestic demand should contribute increasingly to economic growth,

benefi ting from the accommodative monetary policy stance and the measures adopted to improve

the functioning of the fi nancial system. However, activity is expected to continue to be dampened

somewhat by the process of balance sheet adjustment in various sectors. Box 5 in Section 3 entitled

“Results of the ECB Survey of Professional Forecasters for the second quarter of 2011” shows

that real GDP growth expectations have been revised slightly upwards for 2011, while remaining

unchanged for 2012.

The risks to this economic outlook remain broadly balanced in an environment of elevated

uncertainty. On the one hand, global trade may continue to grow more rapidly than expected,

thereby supporting euro area exports. Moreover, strong business confi dence could provide more

support to domestic economic activity in the euro area than currently expected. On the other hand,

downside risks relate to the ongoing tensions in some segments of the fi nancial markets that may

potentially spill over to the euro area real economy. Downside risks also relate to further increases

in energy prices, particularly in view of ongoing geopolitical tensions in North Africa and the

Middle East, and to protectionist pressures and the possibility of a disorderly correction of global

imbalances. Finally, there are still potential risks stemming from the economic impact on the euro

area and elsewhere of the natural and nuclear disasters in Japan.

Chart 32 Labour productivity

(annual percentage changes)

-7

-6

-5

-4

-3

-2

-1

0

1

2

3

4

5

6

-14

-12

-10

-8

-6

-4

-2

0

2

4

6

8

10

12

whole economy (left-hand scale)

industry excluding construction (right-hand scale)

services (left-hand scale)

2004 2005 2006 2007 2008 2009 2010

Sources: Eurostat and ECB calculations.Note: Data refer to the Euro 17.

Chart 33 Unemployment

(monthly data; seasonally adjusted)

-200

-100

0

100

200

300

400

500

600

7.0

7.5

8.0

8.5

9.0

9.5

10.0

10.5

11.0

monthly change in thousands (left-hand scale)

percentage of the labour force (right-hand scale)

2004 2005 2006 2007 2008 2009 2010

Source: Eurostat.

69ECB

Monthly Bulletin

May 2011

1 INTRODUCTION

The recent global fi nancial crisis and ensuing

recession have had major repercussions for the

euro area and US economies. The crisis was

initially triggered by a precipitous decline in

the US housing market that knocked down the

value of large volumes of assets linked to it that

were widely held across the world.1 However,

diverse vulnerabilities were present on a global

scale, allowing the crisis to spill over rapidly

to the euro area and the rest of the global

economy. Global industrial production and

trade contracted sharply and synchronously,

with fi nancial market turbulence quickly

spreading across borders and continents. This

article aims to address three main questions:

what sets this cycle apart from past recessions

and recoveries, and what were the similarities?

Why was the euro area so deeply affected by a

shock that began in the US housing market and

at fi rst appeared to be contained? And what are

the key factors infl uencing the recovery in

economic activity in both the euro area and the

United States? 2

The article is organised as follows. Section 2

describes some stylised facts about the

relationship between US and euro area business

cycles as derived from historical experience, as

well as from previous recessions associated with

fi nancial crises. In Section 3 the article turns

to the current cycle by providing a description

of the downturn and the recovery in economic

activity in the euro area and the United States

against the background of past cycles. The

following sections then seek some explanations

for recent developments, with Section 4 focusing

on the nature of the shock and its transmission,

and Section 5 looking at the private sector and

policy adjustments made in each economy. The

article concludes with some refl ections regarding

the evolution of the economic recovery in both

areas and by highlighting the possible factors

that might set this recovery phase apart from

past cycles.

2 STYLISED FACTS FROM PAST CYCLES

Four main stylised facts based on historical

relationships may be relevant for understanding

the dynamics of this recession and the

subsequent recovery in the euro area and the

United States and in detecting how this cycle

differs from the past. These stylised facts are

derived partly from looking at the characteristics

of past business cycle dynamics in the

United States and the euro area and partly from

a historical analysis of the nature of recessions.

A fi rst fact is that there is strong co-movement

between real GDP per capita in the

United States and the euro area over low

frequencies (see Chart 1), with euro area growth

In particular, it has been argued that an increase in mortgage 1

delinquencies due to a decline in US housing prices was the

trigger for the full-blown liquidity crisis that emerged in

2007. See, for instance, Brunnermeier, M.K., “Deciphering the

Liquidity and Credit Crunch 2007-2008”, Journal of Economic Perspectives, Volume 23, No 1, winter 2009, pp. 77-100.

Note that this article focuses primarily on developments in the 2

euro area as a whole, which encompass a range of developments

across euro area countries.

Economic activity in the euro area and the United States is now slowly recovering, following a recession that was deep and highly synchronised across countries around the globe. This article describes the likely reasons for the differences in the downturn in the euro area in comparison with the United States and provides some refl ections regarding the prospects for recovery in both regions. The main fi ndings are that the degree of synchronisation of economic activity in the euro area and the United States during the current cycle is largely consistent with historical evidence. That said, there have been some differences in euro area and US activity during this cycle compared with the past, and these appear to be largely explained by the nature of the current downturn, the fundamentals prior to the crisis and the way in which the private sector and policies adjusted in the two economies.

ART ICLES

PATTERNS OF EURO AREA AND US MACROECONOMIC CYCLES – WHAT HAS BEEN DIFFERENT THIS TIME?

70ECB

Monthly Bulletin

May 2011

tending to lag that of the United States by several

quarters.3 Further research has shown that there

tends to be an asymmetry within cycles, in that

US downturns are transmitted faster to the euro

area (and the rest of the world) than upturns: it

takes around two quarters for downturns to be

transmitted from the United States to the euro

area, while it takes around six quarters for

upturns.4

Second, taking into account estimates of

potential output and output gaps (using those

provided by the European Commission), the

euro area as a whole tends to exhibit milder

downturns, but also slower rebounds compared

with the United States (see Chart 2). This could

be a refl ection of the fact that the euro area is

well known to be a more socially protected, but

less fl exible, economy than the United States.5

Third, there is historically a high degree of

correlation between US recessions and global

downturns/recessions; hence, US shocks are

often a good proxy for global shocks. As an

indication of this, Chart 3 depicts the percentage

of advanced economies (out of a sample of 19

countries) that have been in recession over time.

Most of the spikes in this chart coincide with

US recessions as defi ned by the National Bureau

of Economic Research (NBER). The latest

recession stands out as having been particularly

widespread across countries: although the

United States entered recession fi rst, in the fi nal

quarter of 2007, it was swiftly followed by most

advanced economies, with the euro area entering

recession in the second quarter of 2008.

A fourth important stylised fact is that recessions

associated with fi nancial crises, as well as those

associated with credit crunches and house

price busts, have typically been particularly

severe and protracted.6 The length and depth of

See Giannone, D., Lenza, M. and Reichlin, L., “Business 3

cycles in the euro area”, Working Paper Series, No 1010, ECB,

Frankfurt am Main, February 2009.

See Dées, S. and Vansteenkiste, I., “The transmission of US 4

cyclical developments to the rest of the world”, Working Paper Series, No 798, ECB, Frankfurt am Main, August 2007.

See Duval, R., Elmeskov, J. and Vogel, L., “Structural Policies 5

and Economic Resilience to Shocks”, Economics Department Working Papers, No 567, OECD, Paris, July 2007.

See: “The latest euro area recession in a historical context”, 6

Monthly Bulletin, ECB, Frankfurt am Main, November 2009;

“From recession to recovery: how soon and how strong?”,

World Economic Outlook, Chapter 3, IMF, Washington, DC,

April 2009; and Claessens, S., Kose, M.A. and Terrones, M.,

“What happens during recessions, crunches, and busts?”,

Working Paper Series, No 08/274, IMF, Washington, DC,

December 2008.

Chart 1 GDP per capita

(year-on-year percentage changes; fi ve-year centred moving averages)

-3

-2

-1

0

1

2

3

4

5

6

-3

-2

-1

0

1

2

3

4

5

6

1973 1978 1983 1988 1993 1998 2003 2008

euro areaUnited States

Sources: Eurostat and Bureau of Economic Analysis.

Chart 2 Output gaps

(as a percentage of estimated potential)

-6

-5

-4

-3

-2

-1

0

1

2

3

4

-6

-5

-4

-3

-2

-1

0

1

2

3

4

1970 1975 1980 1985 1990 1995 2000 2005 2010

euro area

United States

Source: European Commission.

71ECB

Monthly Bulletin

May 2011

ARTICLES

Patterns of euro area and US

macroeconomic cycles – what

has been different this time?

such recessions stems from the fact that, in the

aftermath of fi nancial crises, demand tends to

be restrained by the need for extensive balance

sheet repairs and deleveraging, while severe

disruption within the banking sector also entails

more prolonged credit constraints. Moreover,

as fi nancial intermediation affects all sectors

of an economy and easily spills over to other

countries, shocks are rapidly amplifi ed by the

fi nancial system. As shown in Chart 4, the

current downturn has been particularly severe

even when compared with other systemic crises

in OECD countries.

3 MACROECONOMIC DEVELOPMENTS

DURING THE CURRENT CYCLE

In line with the above stylised facts, the

economic slowdown during the current cycle

started earlier in the United States than in the

euro area, with US GDP growth already slowing

in early 2007, at a time when growth in the euro

area was still accelerating (see Chart 5). At the

time, a widely held view was that the euro

area – and the global economy more generally –

could “decouple” from the United States in its

downturn, given the apparently contained nature

of US domestic problems and the growing

importance of emerging markets in the global

economy.7 However, as the fi nancial crisis

widened and deepened with the failure of some

major fi nancial institutions in the autumn

of 2008, the recession became very deep,

consistent with previous evidence on systemic

fi nancial crises.8

Contributions to the “decoupling debate” can be found, for 7

example, in: “Decoupling the Train? Spillovers and Cycles in the

Global Economy”, World Economic Outlook, Chapter 4, IMF,

Washington, DC, April 2007; “Test of stamina”, The Economist, 12 April 2007; and “Global Economic Integration and

Decoupling”, a speech given by D.L. Kohn at the International

Research Forum on Monetary Policy, Frankfurt am Main,

26 June 2008.

See Reinhart, C.M. and Rogoff, K.S., 8 This Time Is Different: Eight Centuries of Financial Folly, Princeton University Press,

Princeton, 2009.

Chart 3 Synchronisation of recessions across countries

(percentage of countries in recession; shaded areas denote US recessions)

0

20

40

60

80

100

0

20

40

60

80

100

1971 1976 1981 1986 1991 1996 2001 2006

Sources: IMF, ECB and NBER.Note: The sample comprises 19 advanced economies (Australia, Austria, Belgium, Canada, Finland, France, Germany, Greece, Ireland, Italy, Japan, Luxembourg, the Netherlands, Norway, Portugal, South Korea, Spain, Switzerland and the United Kingdom).

Chart 4 Real GDP growth in the euro area and the United States compared with past recessions and crises in OECD economies

(annual percentage changes; quarterly data)

-6

-4

-2

0

2

4

6

-6

-4

-2

0

2

4

6

T-8 T-4 T T+4 T+8 T+12 T+16 T+20

interquartile cycle range2)

past systemic crises3)

euro area (current)United States (current)

normal cycle average1)

Sources: ECB and ECB calculations, Eurostat and OECD.Notes: “T” represents the peak GDP level prior to the recession. For the current euro area and US cycles, “T” represents the fi rst quarter of 2008 and the fourth quarter of 2007 respectively.1) Average real GDP growth during all recessions in OECD countries not categorised as crises.2) The cycle range for OECD recessions is derived as the upper quartile less the lower quartile for all OECD recessions since 1970.3) Average real GDP growth during fi ve severe fi nancial crises since 1970 in Spain, Finland, Sweden, Norway and Japan.

72ECB

Monthly Bulletin

May 2011

Overall, it appears that euro area activity has

been hit quite severely, although the precise

extent relative to the United States depends on

the time span and metric used. In particular,

while the contraction in actual GDP was deeper

in the euro area than in the United States

(see Chart 5), if one takes into account the

fact that the United States typically has higher

growth potential (see box), the downturn

was slightly more severe in the United States

(see Chart 2).

Looking at the recovery phase so far, this

is somewhat at odds with past regularities

identifi ed in Section 2 of this article, as the

upturn in the euro area started at the same

time as that in the United States, although

it has been somewhat more muted. In part,

the relatively synchronised upturn appears to

have been driven by the strong rebound in global

trade, which has helped to boost growth in both

economies.

Chart 5 Real GDP

(year-on-year percentage changes)

-6

-4

-2

0

2

4

6

-6

-4

-2

0

2

4

6

1996 1998 2000 2002 2004 2006 2008 2010

euro area

United States

Sources: Eurostat and Bureau of Economic Analysis.

Box

A COMPARISON OF DRIVERS OF POTENTIAL OUTPUT FOR THE EURO AREA AND THE UNITED STATES

Potential output is generally understood to provide an indication of the level of sustainable real

output in the economy in the medium to long term and its rate of growth. It is also referred

to as the level of output which can be achieved using available production factors without

creating infl ationary pressures.1 The evolution of potential output depends on a number of

underlying factors, foremost among them being supply conditions, such as the endowments of

the economy relating to the key production inputs of capital and labour. The productivity of

these inputs is linked to various factors, such as the effi ciency with which they are combined and

used, demographic trends and human capital, investment in research and development, and the

institutional framework in which the economy operates, as well as structural economic policies.

The rate of potential growth can change substantially over time owing to these factors.

Empirical estimates of potential output are surrounded by considerable uncertainty. This

is particularly the case in the current environment, as the long-term economic implications

of the fi nancial crisis are still unclear. Recent estimates of potential output indicate that

potential growth in both the euro area and the United States is estimated to have fallen

signifi cantly during the recent economic downturn (see Chart A). The average rate of

1 For a more detailed discussion of the role played by measures of potential output in macroeconomic analysis and the uncertainty

surrounding its measurement, see: the article entitled “Potential output growth and output gaps: concept, uses and estimates”,

Monthly Bulletin, ECB, Frankfurt am Main, October 2000; and the box entitled “Potential output estimates for the euro area”,

Monthly Bulletin, ECB, Frankfurt am Main, July 2009.

73ECB

Monthly Bulletin

May 2011

ARTICLES

Patterns of euro area and US

macroeconomic cycles – what

has been different this time?

annual potential growth was estimated to be around 2.0% in the euro area in the period

2000-07, compared with 2.7% in the United States, with a relatively narrow range of

estimates over this period. This compares with average estimates of 1.0% for the euro

area and 1.6% for the United States in the years 2008-10, with wider ranges of estimates.

All in all, the rate of potential growth is estimated to have deteriorated by similar amounts in the

two economies.2

The approaches of international institutions to the estimation of potential output allow potential

growth to be broken down into contributions from changes in the usage of capital and labour in

the economy and contributions from changes in productivity (i.e. “total factor productivity” or

“TFP”). The contributions from the labour input can be disentangled further, distinguishing

between the impact of population growth, the labour market participation rate, changes in the

structural rate of unemployment (the NAIRU) and changes in average hours worked.

Chart B provides breakdowns of potential output growth estimates according to the

contributions of labour, capital and TFP, as well as a breakdown of the labour input for the

euro area and the United States, on the basis of estimates made by the European Commission 3.

These charts reveal a number of interesting trends and stylised facts relating to potential growth

in the years before the fi nancial crisis: fi rst, potential growth in both the euro area and the

United States shows a downward trend in the period 2000-07. In both regions, this is mostly

2 For a more detailed discussion of the factors which could explain the deterioration of potential growth in the context of the recent

fi nancial crisis, see: the article entitled “Trends in potential output”, Monthly Bulletin, ECB, Frankfurt am Main, January 2011; and

“Impact of the current economic and fi nancial crisis on potential output”, European Economy Occasional Papers, No 49, European

Commission Directorate-General for Economic and Financial Affairs, June 2009.

3 European Commission, June 2009.

Chart A Range of estimates of potential output growth in the euro area and the United States

(annual percentage changes)

range of estimates by the OECD, IMF and

European Commission

Euro area United States

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

1992 1994 1996 1998 2000 2002 2004 2006 2008 2010

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

1992 1994 1996 1998 2000 2002 2004 2006 2008 2010

Sources: OECD, IMF and European Commission.

74ECB

Monthly Bulletin

May 2011

Chart C Breakdown of the contribution made by labour to potential output growth in the euro area and the United States 2000-10

(annual percentage changes; contributions in percentage points)

population growth

participation rate

unemployment

average hours worked

labour

Euro area United States

-1.0

-0.5

0.0

0.5

1.0

1.5

-1.0

-0.5

0.0

0.5

1.0

1.5

2000 2002 2004 2006 2008 2010 1 2

Average 2000-07.1

Average 2008-10.2

-1.0

-0.5

0.0

0.5

1.0

1.5

-1.0

-0.5

0.0

0.5

1.0

1.5

2000 2002 2004 2006 2008 2010 1 2

Source: European Commission.

Chart B Contributions to potential output growth in the euro area and the United States 2000-10

(annual percentage changes; contributions in percentage points)

total factor productivitycapital

labour

potential output growth

Euro area United States

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

2000 2002 2004 2006 2008 2010 1 2

Average 2000-07.1

Average 2008-10.2

-0.5

0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

-0.5

0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

2000 2002 2004 2006 2008 2010 1 2

Source: European Commission.

75ECB

Monthly Bulletin

May 2011

ARTICLES

Patterns of euro area and US

macroeconomic cycles – what

has been different this time?

There have been two key differences in the

composition of GDP growth during this cycle

across the two economies (see Chart 6).

The contraction in consumption was much more

pronounced in the United States than in the euro

area, particularly in relation to historical

evidence, as will be discussed further in

Section 5. On the other hand, net trade played a

substantial role in the downturn in the euro area,

but until recently contributed positively to GDP

growth in the United States. The difference in

the contributions of net trade stems partly from

a sharper decline in imports in the United States

during the recession, in line with the

stronger decline in consumption.9 Meanwhile,

the behaviour of inventories, government

consumption and, to a lesser extent, investment

(where the decline started earlier in the United

States, largely stemming from the contraction in

residential investment) has been broadly similar

in the two regions.

A fi nal feature of the recent crisis has been the

longer-term implications for potential output.

Although the uncertainty surrounding those

estimates is considerable, as outlined in the box,

the estimated impact of the crisis on potential

growth has, on average, been similar in the two

areas, with estimates of potential output growth

being revised downwards. Moreover, in line

with past patterns, potential output growth is

See Baldwin, R. and Taglioni, D., 9 The great trade collapse and trade imbalances, November 2009, available at

http://www.voxeu.org

explained by the contributions from TFP, which halved from around 1% in 2000 to less than 0.5%

in 2007 in the euro area, while TFP contributions fell from 1.4% to below 1% over the same period

in the United States. By contrast, the contributions from the accumulation of the capital stock

and from the labour input remained relatively stable in both regions. Second, while population

growth was lower in the euro area than in the United States, this was more than compensated for

by developments in the trend participation rate, which increased in the euro area but declined

somewhat in the United States (see Chart C). Furthermore, the structural rate of unemployment

is estimated to have remained broadly stable in the euro area, compared with an increase in the

United States. These factors gave rise to larger growth contributions from the labour input in

the euro area during the period 2000-07. However, once the potential from higher levels of

participation in the euro area has been mostly exhausted, the impact of population ageing can

be expected to lead to a decline in the contribution made by labour to potential growth relative

to the United States. Finally, the fact that the rate of potential growth is consistently higher in the

United States than in the euro area is primarily a result of more sizeable TFP growth and, to a

lesser extent, a stronger contribution from the accumulation of capital in the United States.

The latest economic downturn has affected factors in potential growth in different ways: while

the estimates of the contribution from TFP changed only marginally, the decline in potential

growth in the context of the fi nancial crisis is generally explained by lower contributions from

the labour and capital inputs in both the euro area and the United States. Regarding the labour

input, an increase in estimates of the structural rate of unemployment contributed signifi cantly

to the decline observed in labour’s contribution to growth in both regions. On top of that,

signifi cantly lower increases in trend labour market participation rates added to the decline in

labour’s contribution in the euro area, whereas trend participation growth rates are estimated to

have remained broadly stable over the crisis period in the United States. Lower contributions

from the capital stock refl ect the decline in investment in the context of the recent economic

downturn. This effect was more sizeable in the United States than in the euro area. All in all, the

lower potential growth over the years 2008-10 stems primarily from declines in the contributions

from labour and capital. In the euro area, the former was more important, whereas the latter

dominated in the United States.

76ECB

Monthly Bulletin

May 2011

estimated to remain higher in the United States

than in the euro area – an important factor

determining the outlook.

Overall, historical regularities appear, for the

most part, to have held during this cycle, in that:

(i) the euro area has lagged the United States

(at least in the downturn); (ii) the downturn in

the United States was larger than that in the

euro area (at least relative to potential growth);

(iii) the US downturn was matched, with a small

lag, by widespread downturns in other countries

around the world; and (iv) the recession was

particularly deep, as it coincided with a fi nancial

crisis. Nevertheless, it is useful to look deeper

at the questions raised initially relating to

the strong degree of synchronisation in the

cycle, the depth of the recession in the euro

area and whether one can gain some insights

regarding the economic outlook by looking

at the main underlying fundamentals and

adjustments in the euro area compared with the

United States.

4 THE NATURE OF THE SHOCK AND ITS

TRANSMISSION TO THE REAL ECONOMY

AND ACROSS BORDERS

Starting with the issue of synchronisation, this

section looks at the nature of the shock and its

transmission. The global recession was triggered

by the downturn in the US housing market, most

notably the problems related to the sub-prime

segment of the US mortgage market. Comparing

the underlying housing market situation in the

euro area and the United States, the adjustment

started earlier and was much more pronounced

in the United States (see Chart 7). While some

signs of a stabilisation in euro area house prices

have recently appeared, there are signs, from the

S&P/Case-Shiller house price index, of further

contraction in the United States, following a

period of improvement driven largely by

temporary policy stimuli.10 These differences in

For more details on the impact of US housing support initiatives 10

on recent housing market developments, see Box 1, Monthly Bulletin, ECB, Frankfurt am Main, September 2010.

Chart 6 Composition of GDP growth in the euro area and the United States

(year-on-year growth in percentages; contributions in percentage points)

consumption

investment

government

inventories

net trade

GDP

Euro area United States

-6

-4

-2

0

2

4

6

-6

-4

-2

0

2

4

6

2007 2008 2009 2010-6

-4

-2

0

2

4

6

-6

-4

-2

0

2

4

6

2007 2008 2009 2010

Sources: Eurostat and Bureau of Economic Analysis.

77ECB

Monthly Bulletin

May 2011

ARTICLES

Patterns of euro area and US

macroeconomic cycles – what

has been different this time?

house prices across the two regions are broadly

mirrored by developments in residential

investment (see Chart 8).11

Despite the US housing sector having been the

main trigger of the crisis, the global fi nancial

system – the euro area included – was vulnerable

more broadly owing to an underpricing of risk

that had resulted in the compression of credit

spreads and high levels of leverage.

The implications for the euro area were thus

more severe, owing to the global reassessment

of risk premia, than they might have been if

the shock had been truly US-specifi c.12

The crisis eventually resulted in a deep fall in

values across all asset classes. It also hit the

banking systems of both economies, where the

transmission was both direct via European

banks’ large losses on US mortgage-backed

securities and indirect through the generalised

increase in risk aversion and the impact of the

crisis on fi nancial market and interbank

liquidity.

The rapid amplifi cation of the shock across

fi nancial systems led to widespread uncertainty

across advanced economies.13 Amid heightened

uncertainty, global demand suffered an

unusually synchronised decline, prompting

sharp retrenchment in purchases of durables

and investment, which led to a collapse in world

The strong declines in residential investment may relate to a 11

more fl exible housing supply in the United States compared with

the euro area, one potential explanation for divergent regional

house price paths, as outlined in Hiebert, P. and Roma, M.,

“Relative house price dynamics across euro area and US cities:

convergence or divergence?”, Working Paper Series, No 1206,

ECB, Frankfurt am Main, June 2010.

Verick, S. and Islam, I., “The Great Recession of 2008-2009: 12

Causes, Consequences and Policy Responses”, Discussion Paper Series, No 4934, IZA, Bonn, May 2010. The authors also argue

that the US sub-prime crisis was at the centre of the crisis, but by

no means the cause. Four main factors caused the crisis: global

current account imbalances; loose monetary policy; the search

for yield and misperception of risk; and lax fi nancial regulation.

In addition, the crisis exacerbated pre-existing macroeconomic 13

imbalances in some euro area countries. Indeed, two countries

are implementing an adjustment programme, while the economic

governance of the euro area as a whole is being overhauled.

Chart 7 House prices

(year-on-year percentage changes)

1996 1998 2000 2002 2004 2006 2008 2010 -20

-15

-10

-5

0

5

10

15

20

-20

-15

-10

-5

0

5

10

15

20

euro area

United States (FHFA house price index)

United States (S&P/Case-Shiller national index)

Sources: ECB, Federal Housing Finance Agency and S&P/Case-Shiller.

Chart 8 Residential investment

(year-on-year percentage changes)

-30

-25

-20

-15

-10

-5

0

5

10

15

-30

-25

-20

-15

-10

-5

0

5

10

15

1996 1998 2000 2002 2004 2006 2008 2010

euro area

United States

Sources: Eurostat and Bureau of Economic Analysis.

78ECB

Monthly Bulletin

May 2011

trade.14 Thus, the crisis was also transmitted to

the global economy via confi dence and trade

channels. The sudden collapse in confi dence

around the globe, together with the combination

of housing market corrections, household

balance sheet adjustments and diffi culties in

short-term fi nancing, all contributed to a marked

decline in the consumption of durables and

investment goods. This, in turn, caused a sharp

contraction in global industrial production and

triggered an adjustment in inventories, both

of which had a strong impact on world trade

(see Chart 9).

The euro area – alongside other economies with

a relatively large manufacturing sector and a

high degree of openness to trade – has tended to

be harder hit by the slowdown in industry and

trade than the United States. Industrial output

excluding construction accounts for around 18%

of total output in the euro area, compared with

15% in the United States. Within the industrial

sector, the euro area has been affected particularly

strongly (in comparison with the United States)

by the sharp downturn in global passenger car

sales in 2008 and its subsequent rebound,

the latter being supported by vehicle scrappage

schemes in a number of countries.15 This is

because the euro area has a more dominant role

in the global car industry, accounting for around

22% of global passenger car production in 2009,

while US production represented less than 5%.16

Export developments in the euro area and the

United States have been relatively similar in

this cycle (see Chart 10). However, the euro

In the case of the United States, Robert Hall has argued that the 14

large decline in real GDP in the latest recession refl ected a decline

in investment, defi ned broadly as including businesses’ fi xed

capital investment, as well as housing and households’ purchases

of durables. Since all such components of investment rely on

fi nancial markets for funds, growth suffered particularly strongly

during the downturn. See Hall, R.E., “Why Does the Economy

Fall to Pieces after a Financial Crisis?”, Journal of Economic Perspectives, Volume 24, No 4, autumn 2010, pp. 3-20.

Further analysis of developments in the euro area and global 15

car industries can be found in Box 5, Monthly Bulletin, ECB,

Frankfurt am Main, December 2010.

These data are based on statistics published by the International 16

Organization of Motor Vehicle Manufacturers.

Chart 10 Exports

(year-on-year percentage changes)

-20

-15

-10

-5

0

5

10

15

20

-20

-15

-10

-5

0

5

10

15

20

1996 1998 2000 2002 2004 2006 2008 2010

euro area

United States

Sources: Eurostat and Bureau of Economic Analysis.

Chart 9 Global industrial production and trade

(year-on-year percentage changes)

-25

-20

-15

-10

-5

0

5

10

15

20

25

-25

-20

-15

-10

-5

0

5

10

15

20

25

1996 1998 2000 20042002 2006 2008 2010

global industrial production

world trade

Sources: Eurostat and Federal Reserve System.

79ECB

Monthly Bulletin

May 2011

ARTICLES

Patterns of euro area and US

macroeconomic cycles – what

has been different this time?

area, being more open to trade, with exports

of goods and services accounting for almost

20% of nominal GDP in 2009, compared with

11% in the United States (see Chart 11), was

more negatively affected than the United States

by the contraction in global trade in terms of

GDP growth. Moreover, the composition of

exports by geographical destination may also

have proved more benefi cial to US export

performance in this cycle compared with

the euro area. As shown in Table 1, a larger

share of US exports go to developing Asia

and the western hemisphere, which have been

less affected by the crisis, whereas most euro

area exports are destined for other advanced

economies and non-industrialised Europe,

i.e. regions that have been affected more

strongly by the crisis.

Overall, several factors explain the high degree

of synchronisation during both the downturn

and the upturn. The strong collapse in growth

during the recession is accounted for by the

global scope of vulnerabilities, together with

the fi nancial nature of the crisis and the decline

in the global industrial sector, which resulted

in the sharp contraction in global trade. Global

trade dynamics also appear to explain why euro

area activity has recovered faster than historical

patterns would have suggested. The declines

appear partly to have been the impact of a

confi dence shock, so as business and consumer

confi dence has rebounded across the world,

the recovery has been faster, as uncertainty has

declined and previously postponed investments

and purchases have been renewed and trade has

picked up quickly, which has benefi ted the euro

area’s recovery.

5 PRIVATE SECTOR ADJUSTMENT DURING THE

RECESSION AND MACROECONOMIC POLICY

REACTIONS

A notable feature of the most recent cycle has

been the difference in the adjustment to the

shocks in the two economies. This section

explores the reaction of the corporate and

household sectors to the sharp decline in activity

during the recession. It also assesses how fi rms

restored profi tability by cutting employment,

reviews the changes in labour market

performance in the two economies compared

with the past and analyses how this affected

household spending. Finally, this section

briefl y looks at the monetary and fi scal policy

adjustments made since the recession began.

Although the declines in activity in the

United States and the euro area during the

recession were of a broadly similar degree, the

adjustments made by fi rms in the two economies

in order to maintain or restore profi tability

Chart 11 Export openness

(exports of goods and services as a percentage of nominal GDP)

0

5

10

15

20

25

0

5

10

15

20

25

1996 1999 2002 2005 2008 2011

euro area

United States

Sources: IMF, ECB and Eurostat.

Table 1 Export destinations by region in 2009

(percentages of total exports)

Euro area United States

Advanced economies 76.0 58.1

Developing Asia 4.7 11.6

Middle East 3.1 3.8

Western hemisphere 2.2 22.5

Non-industrialised Europe 10.0 2.1

Africa 2.9 1.7

Other 1.0 0.1

Source: IMF. Note: The regional aggregates are defi ned in the IMF’s World Economic Outlook.

80ECB

Monthly Bulletin

May 2011

differed signifi cantly. The dip in activity put

pressure on profi ts in both economies, but in the

United States fi rms were better able to protect

profi t margins (see Chart 12). Profi t margins

in the United States fell modestly during the

early stages of the recession, but subsequently

rebounded strongly. By contrast, euro area fi rms

suffered a large contraction in profi t margins

during the recession. Those differences were

primarily refl ected in developments in unit

labour costs during and after the recession.

In the United States, fi rms adjusted swiftly

to the recession, cutting costs sharply, such

that unit labour costs fell during the recession.

By contrast, in the euro area, unit labour costs

increased during the recession and only started

to fall back as of early 2010 (see Chart 13).

One facet of the more favourable developments

in unit labour costs in the United States was

greater wage restraint. When the United States

entered recession in December 2007, initial wage

inertia meant that the growth rate of average

hourly costs continued to increase until mid-2008,

but it declined sharply thereafter. In the euro area,

by contrast, higher wage rigidities meant that

wage growth maintained a stronger pace: growth

in hourly labour costs remained more robust, and

actually rose as high as 4% year on year in the

last quarter of 2008 (see Chart 14). Hourly

wage growth was also boosted by extensive use

of fl exible working time arrangements,

Chart 12 Profit margins (business sector)

(GDP defl ator divided by unit labour costs; annual changes)

-6

-4

-2

0

2

4

6

-6

-4

-2

0

2

4

6

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

euro areaUnited States

Sources: Eurostat, ECB calculations and Bureau of Labor Statistics.Note: Business sector excludes health, education and public administration services.

Chart 13 Unit labour costs (business sector)

(annual percentage changes)

-4

-2

0

2

4

6

8

-4

-2

0

2

4

6

8

euro area

United States

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Sources: Eurostat, ECB calculations and Bureau of Labor Statistics.Note: Business sector excludes health, education and public administration services.

Chart 14 Hourly labour costs

(annual percentage changes)

0

1

2

3

4

5

0

1

2

3

4

5

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

euro area

United States

Sources: Eurostat, ECB calculations and Bureau of Labor Statistics.

81ECB

Monthly Bulletin

May 2011

ARTICLES

Patterns of euro area and US

macroeconomic cycles – what

has been different this time?

particularly in Germany, whereby employees

were allowed to work for fewer hours at times of

lower demand without this impacting their

overall annual compensation. In addition,

government-subsidised short-time work schemes

also allowed fi rms to reduce the hours worked by

their employees, while national governments

supplemented employees’ overall pay. Both

policies mechanically boosted hourly labour costs

by reducing hours worked, but cushioning the

impact on compensation. In contrast, short-time

compensation programmes in the United States

have had only a marginal impact on hourly wages.

First, the use of the equivalent “work-share

programs” in the United States was more

limited: participation peaked at only 0.5% of the

labour force – compared, for instance, with 3.4%

of the labour force at the peak in Germany and

more than 4% in Italy.17 Second, the reduction in

working hours under these programmes also

entailed a proportional reduction in weekly pay in

the United States, which was only partly offset by

partial unemployment compensation benefi ts.

The other key element of the sharp reduction

in unit labour costs in the United States during

the recession was the strong rebound in

productivity (see Chart 15). By contrast, in the

euro area, productivity fell signifi cantly during

the recession. The boost to productivity in the

United States came at the cost of a marked

decline in employment. The United States saw a

larger reduction in the total labour input during

the recession in terms of total hours worked

(see Chart 16). The bulk of that came through

a decline in persons employed, although there

was also some reduction in average hours

worked. In the euro area, although hours per

head fell by a similar amount, the employment

response was much more muted.

An important reason for the differences in the

employment adjustment in the euro area and

the United States appears to refl ect the very

extensive use of shorter working hour schemes

employed in a number of euro area countries

to safeguard employment, partly motivated

by companies’ desire to avoid losses in

fi rm-specifi c human capital during a crisis that

was seen as temporary. This is refl ected by the

See “Unemployment dynamics during recessions and recoveries: 17

Okun’s law and beyond”, World Economic Outlook, Chapter 3,

IMF, Washington, DC, April 2010.

Chart 15 Productivity

(output per person employed; year-on-year percentage changes)

-2

0

2

4

6

-4

-2

0

2

4

6

euro areaUnited States

-42001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Sources: Eurostat, ECB calculations and Bureau of Labor Statistics.

Chart 16 Employment and hours worked

(year-on-year percentage changes)

-8

-6

-4

-2

0

2

4

-8

-6

-4

-2

0

2

4

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

employment – euro area

average weekly hours per employed person – euro area

employment – United States

average weekly hours per employed person – United States

Sources: Eurostat, ECB calculations and Bureau of Labor Statistics.

82ECB

Monthly Bulletin

May 2011

differences in the behaviour of euro area and

US employment and total hours worked for a

given change in GDP (or the elasticity of labour

input to output) relative to past cycles. In the

United States, this elasticity appears to have been

broadly in line with historical standards, while

in the euro area, it was broadly comparable to

previous recessions for total hours worked, but

much lower for employment, suggesting that

euro area employment held up unusually well in

this recession.

The different responses in the euro area and the

United States may, in part, have refl ected

differences in the nature of the shocks in the two

economies. The United States experienced a

pronounced housing bust, combined with a

systemic fi nancial crisis. Firms appear to have

viewed the downturn as a structural shock and

adjusted the labour input sharply. By contrast, in

the euro area as a whole – situations in some

specifi c countries notwithstanding – the housing

market was less affected and household balance

sheets were less stretched: the recession refl ected

more a decline in external demand and a sharp,

perhaps excessive, decline in global confi dence,

which was more likely to lead to only a

temporary fall in demand.18

The result of these changes has been marked

increases in unemployment in both economies

(see Chart 17). However, the steep rise in the

US unemployment rate stands out compared

with past cycles. Moreover, this recession

has seen an exceptionally sharp increase in

long-term unemployment in the United States

(shown in Chart 17 by the proportion of the

unemployed that have been without a job for

more than six months). The rise in unemployment

in the United States partly refl ects the features

of this cycle – the length and depth of the

recession and the relatively modest recovery so

far. However, it is also possible that structural

factors have played a role.19 First, sectoral shifts,

driven by the downsizing of some sectors, such

as construction, car production and fi nancial

services, may have produced a skills mismatch

that has made it harder for some sections of the

jobless to fi nd employment.20 Second, the high

instance of negative housing equity may have

reduced labour mobility.21 Finally, the increase

in the duration of unemployment benefi ts may

also have contributed to the rise in long-term

unemployment.22

Turning to the household sector, the weak situation

in the labour market affected household spending

in both economies. Private consumption has been

relatively modest during this cycle compared with

The IMF notes that the response of unemployment to changes 18

in output is stronger following recessions associated with

fi nancial crises, large housing busts and other sectoral shocks.

See “Unemployment dynamics during recessions and recoveries:

Okun’s law and beyond”, World Economic Outlook, Chapter 3,

IMF, Washington, DC, April 2010.

See also Weidner, J. and Williams, J.C., “What is the new 19

normal unemployment rate?”, Economic Letter 2011-05, Federal

Reserve Bank of San Francisco, 14 February 2011.

Some support for this view can be found in Chehal, P., 20

Loungani, P. and Trehan, B., “Stock-market-based measures of

sectoral shocks and the unemployment rate”, Economic Letter 2010-23, Federal Reserve Bank of San Francisco, 2 August 2010.

According to Ferreira, F., Gyourko, J. and Tracy, J., “Housing 21

busts and household mobility”, Working Paper Series, No 14310,

NBER, September 2008, US household mobility is almost 50%

lower for owners with negative equity on their homes.

See, for example, Valletta, R. and Kuang, K., “Extended 22

unemployment and UI benefi ts”, Economic Letter 2010-12,

Federal Reserve Bank of San Francisco, 19 April 2010.

Chart 17 Unemployment and long-term unemployment

(right-hand scale: percentages of labour force; left-hand scale: percentages of unemployed persons)

0

10

20

30

40

50

60

70

1996 1998 2000 2002 2004 2006 2008 20100

2

4

6

8

10

12

United States – unemployed > six months

(left-hand scale)

euro area – unemployed > six months (left-hand scale)

United States – unemployment rate (right-hand scale)

euro area – unemployment rate (right-hand scale)

Sources: Eurostat, ECB calculations and Bureau of Labor Statistics.

83ECB

Monthly Bulletin

May 2011

ARTICLES

Patterns of euro area and US

macroeconomic cycles – what

has been different this time?

the past. Chart 18, which compares consumption

developments during the recent recession and

recovery with average developments in past

cycles, suggests a particularly stark difference

in the United States. Consumption fell during

the recession by much more than in past cycles.

Moreover, so far during the recovery phase, US

household spending has been fairly muted.

The other main factor that has characterised the

US household sector during this cycle has been

the need for greater balance sheet adjustment.

Prior to the recession, household debt levels were

at historical highs in both economies, although

the increase in debt was especially marked in

the United States in the years prior to 2007.

High debt levels, combined with large falls in

asset prices – both housing and fi nancial assets –

have generated large declines in net worth in the

United States. Those declines, coupled with the

increased uncertainty regarding the economic

outlook, appear to be an important factor

contributing to higher savings by US households

(see Chart 19), refl ecting a need for households

to repair their balance sheets. This has resulted in

an upswing of roughly 4 percentage points in the

US saving ratio since the start of the recession, a

larger increase than in the euro area.

Finally, the policy responses to the recession

have also differed somewhat in the euro area

and the United States, partly elicited by the

timing and nature of the slowdown in the two

areas. The recession saw signifi cant monetary

stimulus from both the Federal Reserve System and

the ECB. Interest rates were reduced (see Chart 20)

Chart 18 Private consumption during recessions and recoveries

(year-on-year percentage changes)

-3

-2

-1

0

1

2

3

4

5

-3

-2

-1

0

1

2

3

4

5

peak to trough first year of recovery

average of past euro area cycles

current euro area cycle

average of past US cycles

current US cycle

Sources: Eurostat, ECB and ECB calculations, and Bureau of Economic Analysis.

Chart 19 Household saving ratios

(percentages of households’ disposable income)

0

5

10

15

20

25

30

0

2

4

6

8

10

12

14

1980 1986 1992 1998 2004 2010

euro area (left-hand scale)

United States (right-hand scale)

Sources: Eurostat, ECB and ECB calculations, and Bureau of Economic Analysis.

Chart 20 Central bank policy rates

(percentages)

0

1

2

3

4

5

6

7

0

1

2

3

4

5

6

7

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

United Stateseuro area

Source: Bloomberg.

84ECB

Monthly Bulletin

May 2011

and both central banks rapidly expanded their

balance sheets. Further quantitative easing is

ongoing in the United States, while the ECB,

although continuing its policy of full allotment

in open market operations and some other

non-standard policy measures, has recently

increased interest rates.

Turning to fi scal policies, both governments ran

larger defi cits during the recession (see Chart 21).

However, general government defi cits in the

United States have been larger than the euro

area aggregate, even though there has been

considerable heterogeneity in fi scal positions

across euro area countries. During the recession,

the increase in the overall defi cit ratio between

2007 and 2009 was 8.4 percentage points in the

United States, compared with 5.6 percentage

points in the euro area.23 This has meant a sharp

increase in government debt levels, with US

gross general government debt as a proportion

of GDP surpassing that of the euro area in 2008.

Since the end of the recession, governments in

both economies have begun some fi scal

consolidation. However, consolidation plans

have been more advanced in the euro area, with

the sovereign debt crisis prompting particularly

strong consolidation plans in some euro area

countries. According to the European

Commission, the euro area’s aggregate defi cit is

projected to be just under 4% in 2011, while the

US defi cit is projected to be close to 8%.

The fact that US defi cits remain high highlights

the more favourable debt path dynamics of the

aggregate euro area position compared with the

United States and points to a signifi cant need for

consolidation in the United States in the future.

6 CONCLUSIONS

Overall, a number of factors appear to have driven

the high degree of synchronisation and the depth

of the recession on both sides of the Atlantic.

Although the global recession was triggered by

the downturn in the US housing market, there

was vulnerability in the global fi nancial system

more broadly owing to an underpricing of risk

that had resulted in the compression of credit

spreads and the accumulation of high levels of

leverage. The crisis had a common starting point

in global fi nancial markets owing to deeper

inter-linkages and a simultaneous, widespread

and acute general repricing of risk. This was then

combined with a sharp deceleration in trade and

retrenchment in investment and consumption

globally. These factors, combined with the euro

area’s greater openness and higher share of

manufacturing production, also help to explain

why the euro area was so strongly affected by

a shock that had originated in the US housing

market.

However, although the depth and severity

of this recession stands out to some

extent compared with past recessions, the

co-movement observed during this cycle for

The expansionary fi scal policies at the federal level in the United 23

States were somewhat offset by policies at the state and local

government level, which were contractionary during the recession,

refl ecting the pro-cyclical response induced by balanced budget

requirements. According to Follette, G. and Lutz, B., “Fiscal

policy in the United States: automatic stabilizers, discretionary

fi scal policy actions, and the economy”, Finance and Economics Discussion Series, Federal Reserve Board, 2010-43,

the combined effects of federal, state and local budgets on

aggregate demand were expansionary in 2008 and 2009.

Chart 21 General government balance

(as a percentage of GDP)

-15

-12

-9

-6

-3

0

3

-15

-12

-9

-6

-3

0

3

2001 2003 2005 2007 2009 2011

euro area

United States

Source: European Commission, November 2010.Note: Figures for 2011 and 2012 are forecasts.

85ECB

Monthly Bulletin

May 2011

ARTICLES

Patterns of euro area and US

macroeconomic cycles – what

has been different this time?

the United States and the euro area has been

relatively close to historical experience. For

the most part, historical regularities appear to

have held during this cycle, in that: (i) the euro

area has lagged the United States (at least in

the downturn); (ii) the downturn in the United

States was deeper than that in the euro area

(at least relative to average growth); (iii) the

US downturn was matched, with a small lag,

by widespread downturns across advanced

countries; and (iv) the recession was particularly

deep, as it coincided with a fi nancial crisis and

associated balance sheet deleveraging.

A key question, then, is: are historical patterns

expected to continue in the recovery phase?

Will the US rebound be as strong as in past

cycles, with the euro area lagging behind?

So far, both economies have seen relatively

modest recoveries – at least compared with

past cycles. While signs of a cyclical pick-up

have now become stronger, key determinants

for the outlook are also the underlying

fundamentals in the two economies and the

extent to which structural factors may hold

back the recovery in GDP growth.

As discussed earlier, the similar headline

GDP fi gures have masked somewhat different

adjustments and fundamentals in the two

economies. The United States saw a faster and

sharper recovery in corporate profi tability driven

by cost-cutting and improved productivity. But

that has been at the expense of much higher

unemployment, part of which could turn out

to be structural. Meanwhile, the US household

sector has also undergone signifi cant adjustment

via deleveraging and rising saving rates. In

this respect, a key factor for the outlook lies in

the extent to which households in the United

States will undertake further deleveraging

and adjustments to savings in the near term. A

particular pressure in that regard may come from

the housing market. The latest house price data

in the United States point to signs of renewed

deterioration, which may be linked to the

withdrawal of some of the government measures

put in place to support the housing market.

The recent increases in private consumption

notwithstanding, the combined pressure of

continued deterioration in the housing market

and continued weakness in the labour market

may put further downward pressure on

US household spending in the near term.

On the other hand, there may also be

developments that weigh against the euro

area recovery relative to the United States.

The United States is estimated to have a

higher potential growth rate than the euro

area, owing to more favourable demographic

developments and higher productivity growth.

This will sustain US GDP growth rates relative

to the euro area. Furthermore, there remain

imbalances in some parts of the euro area.

These imbalances need to be resolved, which

might imply the dampening of growth prospects

in some countries in the transition phase.

Finally, it should be recalled that both

economies face challenging fi scal situations,

which – if left unaddressed – have the potential

to create feedback effects with an impact on the

real economy. While the fi scal consolidation

process in the euro area has started, the process

of balancing budgets is expected to take several

years. On the other hand, the continued fi scal

expansion in the United States implies an even

larger burden on the US economy looking

ahead.

87ECB

Monthly Bulletin

May 2011

ARTICLES

The external

representation of

the EU and EMU

THE EXTERNAL REPRESENTATION OF THE EU AND EMU

Recent developments, such as the agreement on IMF governance reform, the emergence of the G20 as the prime informal grouping to coordinate the global crisis response and the adoption of the Lisbon Treaty, make it appropriate to pay closer attention to the evolution of the external representation of the EU and EMU during the fi rst twelve years of the euro. This article looks into the rationale for European coordination on issues of interest to the EU and of particular relevance to EMU that are addressed in international fi nancial institutions and fora, and explores the benefi ts of a coherent external representation on such issues. The article explains why the ECB is interested in effi cient coordination and representation on European issues and how it contributes to this objective. Against this background, the article reviews and assesses the current arrangements in particular for representing EMU externally and looks at the challenges ahead.

1 THE RATIONALE FOR EUROPEAN

COORDINATION AND INTERNATIONAL

COOPERATION ON EMU ISSUES

EU Member States and euro area countries

are undergoing two simultaneous integration

processes. Like all advanced economies, they

are integrating into the international economy

as part of the overall process of globalisation.

Uniquely, they have also been integrating

increasingly among themselves via the process

of European integration. The combination of

these two processes puts EU Member States in

a special position when it comes to international

cooperation.

Globalisation in general creates structural

economic shifts that constrain the possibilities

of EU Member States – like all countries – to

take economic and fi nancial decisions without

exerting an infl uence on each other. Cooperation

at the international level is a tool for better

internalising the external effects of such

economic and fi nancial decisions, as well as

for mitigating the risks of negative spillovers

arising from unsustainable domestic policies

and developments.1 The EU, which is the largest

economic area in the world as well as the

world’s largest exporter of goods and services,

and the euro area, which issues the second most

important reserve currency, are key partners in

this process.

European integration has fostered economic

interdependence between EU Member States,

which together form an internal market, and are

thereby becoming increasingly aligned in their

economic interests. Even when the interests

of individual EU Member States diverge, the

distance between their positions is likely to be

smaller than those between non-EU countries.

This means that there is a strong incentive

for EU Member States not only to actively

engage in international fora, but also to do so

in a coordinated manner. This rationale is even

stronger for the euro area countries, which share

a common currency.

EUROPEAN INTEGRATION AND COORDINATION

ON EMU ISSUES

Beyond the economic rationale for coordination,

the creation of the Single Market and the

single currency, and the requirement for

EU Member States to coordinate their economic

policies within a European framework, imply

a transfer of economic policy competences

from the national to the European level.

This transfer of competences, which can be

partial or even complete in specifi c instances,

also has implications for the representation of

these policy areas in international fora.

In particular, in line with European Court of

Justice (ECJ) case law, where the EU has an

exclusive internal competence, the EU alone

is responsible for the external representation

of that competence. Looking specifi cally at

The positive aspects of globalisation were highlighted in an article 1

entitled “Globalisation, trade and the euro area macroeconomy”,

Monthly Bulletin, ECB, January 2008. See also the article on

the benefi ts of global cooperation entitled “The fi nancial crisis

and the strengthening of global policy cooperation”, Monthly Bulletin, ECB, January 2011.

88ECB

Monthly Bulletin

May 2011

competences relevant for EMU, this principle

applies for the single monetary policy and

exchange rate policy, and at the EU level for

competition policy and the common commercial

policy. In all of these areas, the relevant EU

institutions represent their policy competence in

international fora.

In areas where both the EU and the Member States

are competent, representation is typically more

complex. Economic and fi nancial policies are a

case in point. While some competences (such as

the Single Market, including fi nancial regulation,

as well as energy and the environment) are shared

between the EU and the Member States, other

policy areas, in particular fi scal and structural

policies, have remained largely a national

competence, albeit subject to coordination and

surveillance tools at the European level. The ECJ

stipulated in an opinion that,

“… when it appears that the subject-matter of an

international convention falls in part within the

competence of the [Union] and in part within

that of the Member States, it is important to

ensure that there is a close association between

the institutions of the [Union] and the Member

States both in the process of negotiation and

conclusion and in the fulfi lment of the obligations

entered into. This duty of cooperation … results

from the requirement of unity in the international

representation of the [Union].” 2

The most relevant shared competences from

the EMU perspective are those related to the

internal market. Here, there is both an economic

incentive for EU Member States to coordinate

their positions in international fora in view of

the mutual interconnectedness of their economies,

and also a legal obligation to do so, owing to the

wide-ranging EU initiatives in this area, which

result in a high degree of harmonisation of their

national legislation. EU Member States also

share a common interest in ensuring consistency

between EU and international regulations so as

to avoid regulatory arbitrage.

There is also a rationale for EU Member States

and euro area countries to coordinate their

representation on issues or policies, such as

fi scal and structural policies, that are largely

national competences. This is because these

policies are guided by EU policy frameworks

and are, at the same time, increasingly subject to

international cooperation. Thus the institutional

policy set-up of the EU and the euro area needs

to be adequately respected and represented.

In view of their more stringent governance

framework, the rationale for coordination is

particularly relevant for euro area countries.

For example, within the context of the G20

Framework for Strong, Sustainable and

Balanced Growth, as far as assessments of

external imbalances are concerned, the European

dimension needs to be duly taken into account.

Also at the time of the IMF-led multilateral

consultations on global imbalances in 2006,

the euro area participated together with other

systemically important countries, i.e. China,

Japan, Saudi Arabia and the United States.

Another illustration of the perception of the euro

area as an entity in its own right are the spillover

reports that the IMF will conduct in 2011 for the

euro area, as well as for China, Japan, the United

Kingdom and the United States. Moreover, the

EU is a member in its own right in the G20,

which has emerged as the prime informal

grouping to coordinate the policy response to the

current crisis at the global level.

Finally, it should also be noted that, according

to a recent Eurobarometer survey 3, most EU

citizens do not feel that their countries are best

placed to represent their interests on EU and

EMU-related issues by acting alone in

international fora. Indeed, less than one in ten

EU citizens consider their national government

to be the right agent when it comes to the

regulation and reform of global fi nancial

markets, and instead put more trust in the

international and European organisations to

address these tasks. Many citizens favour a

stronger role for the EU as an actor on the

Opinion No 2/91 of the European Court of Justice of 19 March 2

1993, ECR I-01061.

Economic Governance in the European Union, Standard 3

Eurobarometer 74, January 2011.

89ECB

Monthly Bulletin

May 2011

ARTICLES

The external

representation of

the EU and EMU

international stage, with over eight in ten

supporting a greater role for the EU in the

process of developing new rules to govern the

global fi nancial sector. These fi ndings suggest

strong public support in EU Member States for

international cooperation on European issues.

2 COMPLEXITIES IN THE EXTERNAL

REPRESENTATION OF EMU

While there is a clear rationale for the EU

Member States to coordinate their participation

in international cooperation, their representation

in international institutions and fora is

characterised by a certain degree of complexity.

The representation of the “monetary leg” of

EMU is unifi ed and consistent. The single

monetary policy is represented through the ECB

in all relevant institutions and fora. This clarity

derives from the fact that monetary policy is an

exclusive EU competence, which implies that

the EU has sole responsibility to represent it

externally. The ECB is given a clear role under

the Treaty to decide on this representation

(see the box below). A similar clarity applies to

exchange rate matters, which are also an

exclusive EU competence. However, in contrast

to monetary policy, both the ECB and the

ECOFIN Council (de facto the Eurogroup 4) are

involved in this competence. Eurogroup

participants regularly review exchange rate

developments and both the President of the

Eurogroup and the President of the ECB

participate in informal gatherings during which

exchange rate matters are discussed. This specifi c

set-up for the external representation of monetary

and exchange rate issues has required some

adjustments to be made to the existing rules and

procedures of international institutions and fora –

as will be described in the following section. The

long-standing framework for international

cooperation, where membership is as a rule

country-based, was not tailored to the involvement

of a monetary union that is not at the same time

a fully fl edged political union, i.e. a currency

with a central bank, but without a “government”.

The Eurogroup was created to meet the need for enhanced 4

economic policy coordination amongst EU Member States

sharing the single currency. At its informal monthly meetings,

the Eurogroup brings together, under the chairmanship of its

elected President, the fi nance ministers of the euro area countries,

the European Commissioner for Economic and Monetary Affairs

and the President of the ECB.

Box

RELEVANT EU PROVISIONS GOVERNING COORDINATION AND REPRESENTATION ON EMU ISSUES

The EU framework for coordination and representation of EMU is based on European Council

conclusions, Article 138 of the Treaty on the Functioning of the European Union (TFEU)

and the Statute of the European System of Central Banks and of the European Central Bank

(Statute of the ESCB). These provisions aim to ensure the coherence and effectiveness

of the EU, so as to enable it “to speak with one voice on issues of particular relevance to

economic and monetary union.” 1

Legal basis

While Article 138 of the TFEU confi rms in substance the provisions of the Nice Treaty regarding

EMU external representation, it clearly strengthens its wording by adding an explicit reference

to a “unifi ed representation within the international fi nancial institutions and conferences.” 2

1 Paragraph 15 of the Presidency conclusions of the Vienna European Council of 11 and 12 December 1998.

2 Article 138(2) of the TFEU.

90ECB

Monthly Bulletin

May 2011

Representation of the “economic leg” of EMU

is less uniform. This is the result of the EU’s

multi-level governance framework, where

competences for economic and fi nancial

policies are shared, to varying degrees, between

the EU and its Member States. Economic

policies are largely a national competence.

In these areas, EU Member States can decide on

their own representation, although this needs to

take into account that economic and fi nancial

policies are subject to EU-level coordination

frameworks. Financial policies constitute

another example of where both the European

Commission and national authorities may

exercise regulatory competences. Beyond that,

there are several other factors that make the

coordination of external representation on issues

of relevance to EMU more complex.

First, some issues are relevant for the EU as a

whole (e.g. single market and fi nancial sector

issues), while others pertain only to the euro area

(e.g. euro monetary and exchange rate policies),

which implies that different coordination

This adds to the existing provisions regarding the establishment of common positions on “matters

of particular interest for economic and monetary union”.3 Such positions have to be adopted

by the Council (in euro area composition) after consulting the ECB, on a proposal from the

European Commission. The same institutional framework prevails for the adoption of measures

to ensure a unifi ed representation.

The Statute of the ESCB charges the ECB with the task of deciding how the ESCB shall be

represented. In order to prevent any confl ict with Council decisions, Article 6.3 of the Statute

specifi es that these decisions “shall be without prejudice to Article 138 of the TFEU.” 4

Key policy steps

The December 1997 and December 1998 European Council conclusions launched the external

representation policy for EMU. In December 1997 the Luxembourg European Council agreed

on a basic framework for the implementation of an external coordination and representation of

EMU: “The Council and the European Central Bank will fulfi l their tasks in representing the

[Union] at international level in an effi cient manner and in compliance with the distribution of

powers laid down in the Treaty. The Commission will be associated with external representation

insofar as necessary to enable it to fulfi l the role assigned to it by the Treaty.” 5

In December 1998 the Vienna European Council conclusions further specifi ed practical

arrangements for the external representation of EMU in order to strengthen coordination on

EMU issues in international fora, such as the IMF and the G7: “The introduction of the euro will

be a major event for the international monetary system. It is imperative that the [Union] should

play its full role in international monetary and economic policy cooperation within fora like the

G7 and the International Monetary Fund.” 6 Moreover, the European Council reiterated its call

for cooperation between EU institutions and Member States by encouraging them to “take the

necessary action to ensure a timely and effective preparation of common positions and common

understandings which can be presented to third parties in international fora.” 7

3 Article 138(1) of the TFEU.

4 Article 6.1 of the Statute of the ESCB.

5 Paragraph 46 of the Presidency conclusions of the Luxembourg European Council of 12 and 13 December 1997.

6 Paragraph 14 of the Presidency conclusions of the Vienna European Council of 11 and 12 December 1998.

7 Paragraph 15 of the Presidency conclusions of the Vienna European Council of 11 and 12 December 1998.

91ECB

Monthly Bulletin

May 2011

ARTICLES

The external

representation of

the EU and EMU

processes are required. This is particularly

evident in the G20 where, for example, the

euro area dimension is relevant for discussions

on global imbalances, but the EU dimension is

relevant for discussions on the implementation

of fi nancial sector regulation.

A second complication is that not all EU Member

States are members of all international institutions

and fora. While all EU Member States are

members of the IMF, only a sub-set of them is

represented in the OECD, G7, G20 or FSB.

Third, the fact that competences are spread over

several EU institutions may also complicate the

external representation of EMU. Whereas there

is only one institution – the ECB – that decides

on and speaks for the single monetary policy, a

number of EU institutions and bodies have a stake

in economic and fi nancial issues. For example,

representation of a common EU position on

fi nancial sector regulation at the G20 may involve

the European Commission, the ECOFIN Council,

the ECB and the newly established European

System of Financial Supervision.

Fourth, the external representation of the

“economic leg” of EMU is complicated by

the fact that the established framework for

international cooperation is mostly country-

based and therefore not tailored to the

involvement of regional integration groups.

As a consequence, national representatives may

fi nd themselves in situations where they need

to represent EU competences on behalf of the

EU. This is, for instance, the case for the IMF

Executive Board, where neither the European

Commission nor the EU Council Presidency are

members, and the ECB only has an observer

status (see below).

3 REVIEW OF CURRENT ARRANGEMENTS

Looking at a selected set of current arrangements

in international institutions and fora reveals the

complexities of the external representation on

EU and EMU issues discussed above. Over time,

the EU and the euro area have developed

procedures to help prepare international policy

discussions. For instance, the various topics

on the agenda of international meetings at the

level of fi nance ministers – such as international

economic policy cooperation, fi nancial regulation

and reform of the international monetary system –

are discussed and prepared at euro area/EU

level by the Eurogroup and the ECOFIN

Council and their respective sub-groups, such

as the Eurogroup Working Group (EWG)

or the Economic and Financial Committee

(EFC). Within the Eurosystem/ESCB, the

International Relations Committee of the ECB

assists the ECB’s decision-making bodies in

developing common views on international policy

issues of relevance to central banks and serves as

a forum for discussion and exchange of views.

INTERNATIONAL MONETARY FUND

On the IMF Executive Board, which is the

decision-making body for the Fund’s day-to-day

business, euro area countries are currently spread

over eight out of a total of 24 constituencies, and

the EU Member States over ten constituencies

(see table below). Of these, France, Germany

and the United Kingdom each appoint their own

Executive Director, while the other countries

belong to mixed constituencies that also involve

non-EU countries. The composition of these

mixed constituencies is a result of voluntary

decisions when countries joined the Fund

and/or of later moves to take up more infl uential

positions in another constituency.

The IMF’s Articles of Agreement restrict

membership of the Fund to countries.

To enable the ECB to be represented at the

IMF without changing this rule, the ECB was

granted observer status at the end of 1998.

This pragmatic solution enables an ECB observer

to participate in meetings of the IMF Executive

Board that deal with issues of direct relevance

to the ECB. Moreover, the President of the ECB

and the European Commissioner for Economic

and Monetary Affairs attend the meetings of the

International Monetary and Financial Committee

(IMFC) twice a year in the context of the IMF’s

Spring and Annual Meetings.

92ECB

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May 2011

Since 1997 EU Member States have stepped up

their coordination on IMF issues. Coordination

takes place either in Brussels-based meetings,

in particular in the EFC sub-committee on

IMF-related issues (SCIMF), as well as directly

in Washington in the EURIMF group, which

brings together the representatives of the

EU Member States at the IMF. It depends on the

topic under discussion whether it is the euro area

that develops common views or whether all

EU Member States are involved. For instance,

the discussion on the IMF’s fl agship report,

the World Economic Outlook, which involves

a discussion on global economic, fi nancial and

exchange rate developments, is usually prepared

among euro area countries. Moreover, for the

euro area Article IV discussions 5 in the IMF

Executive Board, the euro area speaks with one

voice and issues a written statement, which

includes a distinct section on monetary policy

prepared by the ECB.

Common views on the Global Financial

Stability Report, which focuses on fi nancial

market issues and developments, are prepared

among the EU Member States in view of

the existence of the single fi nancial market.

An example of the application of the single

voice principle among EU Member States is

the written statement which is delivered at

the biannual meetings of the IMFC on behalf

of the EU by the EU Member State that holds

the rotating EU Presidency. On other issues,

common terms of reference provide a set of

messages to be integrated into the individual

statements of Executive Directors from euro

area or EU countries.

ORGANISATION FOR ECONOMIC CO-OPERATION

AND DEVELOPMENT

As in the case of the IMF, membership of the

OECD is restricted to countries. However,

contrary to the IMF, only a sub-set of 21 EU

Member States are members of the OECD,

namely Austria, Belgium, the Czech Republic,

Denmark, Estonia, Finland, France, Germany,

Greece, Hungary, Ireland, Italy, Luxembourg,

the Netherlands, Poland, Portugal, Slovakia,

Slovenia, Spain, Sweden and the United

Kingdom. Moreover, the ECB and the European

Commission also attend certain meetings of the

OECD.

Article IV consultations are regular reviews of member 5

countries’ policies and developments by the IMF under its

surveillance mandate. The Fund also conducts a regular review

of the monetary, fi nancial and economic policies of the euro area

as a complement to its Article IV consultations with individual

euro area countries.

Current dispersion of EU Member States over ten constituencies in the IMF

Germany

France

United Kingdom

Belgian constituencyBelgium

Austria

Hungary

Czech Republic

Slovak Republic

Luxembourg

Slovenia

Other 3 countries

Dutch constituencyNetherlands

Romania

Bulgaria

Cyprus

Other 10 countries

Mexican – Spanish – Venezuelan constituencySpain

Other 7 countries

Italian constituencyItaly

Greece

Portugal

Malta

Other 3 countries

Canadian constituencyIreland

Other 11 countries

Nordic constituencySweden

Denmark

Finland

Lithuania

Latvia

Estonia

Other 2 countries

Swiss constituencyPoland

Other 7 countries

93ECB

Monthly Bulletin

May 2011

ARTICLES

The external

representation of

the EU and EMU

Among the OECD committees and working

parties that are attended by EU representatives,

the Economic and Development Review

Committee (EDRC) is of particular relevance.

The EDRC has primary responsibility for

conducting reviews of the economic situation

and policies of each OECD member country.

It also conducts regular economic reviews of the

euro area and the EU, with a view to identifying

the main economic developments in the area

and analysing policy options to address them.

These reviews complement the reviews of

individual euro area countries and EU Member

States. For these reviews of the euro area and the

EU, common terms of reference are prepared by

the EFC, in liaison with the ECB for the section

on monetary policy.

INFORMAL FORA FOR FINANCE MINISTERS

AND CENTRAL BANK GOVERNORS

G20 FINANCE MINISTERS AND CENTRAL BANK

GOVERNORS

The complexities involved in the external

representation of EMU can also be observed in

the framework of cooperation within the G20,

which was designated by G20 leaders at the

Pittsburgh Summit in September 2009 as the

premier forum for economic cooperation.

France, Germany, Italy and the United Kingdom

are members of the forum of G20 fi nance

ministers and central bank governors, while

Spain has a permanent invitation. The EU is

also a member of this forum, represented by the

ECB, the rotating EU Council Presidency and

the European Commission. At the meetings of

the G20 leaders, which have taken place since

2008, the EU is represented by the President

of the European Council and the President of

the European Commission. For the meetings

of G20 fi nance ministers and central bank

governors, EU Member States prepare common

terms of reference. Moreover, a letter setting

out the key EU policy priorities is circulated to

G20 members.

G7 FINANCE MINISTERS AND CENTRAL BANK

GOVERNORS

Finance ministers and central bank governors

of the G7 mainly discuss economic and

fi nancial developments and prospects in their

respective countries/economic area, including

exchange rate issues. France, Germany, Italy

and the United Kingdom are members of the

G7. Moreover, both the President of the ECB

and the President of the Eurogroup are invited

to all parts of the meetings of the G7 fi nance

ministers and central bank governors, whereas

the European Commissioner for Economic and

Monetary Affairs only participates in certain

parts of the meetings (as do the central bank

governors of France, Germany, Italy and the

United Kingdom).

FINANCIAL STABILITY BOARD

The Financial Stability Board (FSB), which was

established in April 2009 as the successor to

the Financial Stability Forum, is a key body in

addressing vulnerabilities, as well as developing

and implementing strong regulatory, supervisory

and other policies to safeguard fi nancial

stability. The authorities of a number of EU

Member States – Germany, Spain, France, Italy,

the Netherlands and the United Kingdom – are

represented in the FSB. Moreover, both the ECB

and the European Commission are members.

At the EU level, common grounds on different

issues of the agenda of the FSB are developed

by the EU Financial Services Committee, which

contributes to the preparations of the meetings

of the EFC on fi nancial policy issues.

BANK FOR INTERNATIONAL SETTLEMENTS

AND RELATED CENTRAL BANK FORA

The BIS fosters international monetary and

fi nancial cooperation and serves as a bank for central

banks. It fulfi ls its mandate by acting, among other

things, as a forum for discussion and decision-

making among central banks and within the

international fi nancial and supervisory community.

94ECB

Monthly Bulletin

May 2011

As a shareholder of the BIS, the ECB and most

euro area central banks participate in the Annual

General Meeting of the BIS. The President of

the ECB is also an elected member of the BIS

Board of Directors.

Hosted by the BIS, the bi-monthly Global

Economy Meeting (GEM) is the main forum for

discussion among central bank governors at the

global level. Governors assess global economic

and fi nancial conditions and analyse the global

fi nancial system. The central bank governors

of several EU Member States are members of

the GEM, namely those of Belgium, Germany,

Spain, France, Italy, the Netherlands, Poland,

Sweden and the United Kingdom. Moreover, the

governors from the Czech Republic, Denmark,

Ireland, Greece, Hungary, Austria, Portugal,

Romania and Finland attend meetings on a

revolving basis as observers. The President of

the ECB is a member of the GEM and also its

current chairperson.

The BIS also acts as hub for a number of

permanent committees, of which the following

are of particular relevance:

the Basel Committee on Banking Supervision •

(BCBS);

the Committee on the Global Financial System •

(CGFS);

the Committee on Payment and Settlement •

Systems (CPSS);

the Markets Committee.•

The BCBS provides a forum for regular

cooperation on banking supervisory matters with

the objective of enhancing understanding of key

supervisory issues and improving the quality of

banking supervision worldwide. Supervisory

authorities from a number of EU Member

States are members of the BCBS, i.e. Belgium,

Germany, Spain, France, Italy, Luxembourg, the

Netherlands, Sweden and the United Kingdom.

The ECB has observer status at the meetings

of the BCBS.

The CGFS is mandated to identify and assess

potential sources of stress in global fi nancial

markets, further the understanding of the

structural underpinnings of fi nancial markets,

and promote improvements to the functioning

and stability of these markets. Authorities

from Belgium, Germany, Spain, France, Italy,

Luxembourg, the Netherlands, Sweden and

the United Kingdom, as well as the ECB,

are members of the CGFS.

The CPSS contributes to strengthening the

fi nancial market infrastructure through promoting

sound and effi cient payment and settlement

systems. The CPSS is a standard-setting body

for payment systems and, in cooperation with

IOSCO, for securities and derivatives clearing

and settlement systems. It also serves as a

forum for central banks to monitor and analyse

developments in domestic payment, settlement

and clearing systems as well as in cross-

border and multi-currency settlement schemes.

The central banks of Belgium, Germany, France,

Italy, the Netherlands, Sweden and the United

Kingdom, as well as the ECB, are members of

the CPSS.

The Markets Committee acts as a forum for

open and informal exchanges of views on

recent developments in fi nancial markets

and the possible short-term implications of

particular current events for the functioning

of these markets and central bank operations.

As regards European representation, the Markets

Committee comprises offi cials from the NCBs

of Belgium, Germany, Spain, France, Italy, the

Netherlands, Sweden and the United Kingdom,

as well as the ECB.

4 CHALLENGES AND OPPORTUNITIES AHEAD

While all EU Member States have a strong

economic incentive, as well as a legal obligation,

to coordinate their positions at the international

level, this incentive is, as argued before,

particularly strong for euro area countries by

virtue of their closer integration through sharing

a single currency. The following observations

95ECB

Monthly Bulletin

May 2011

ARTICLES

The external

representation of

the EU and EMU

on the challenges and opportunities ahead will

therefore take primarily a euro area perspective.

Many of the complications described above

could be overcome if the euro area countries were

to avail themselves of Article 138 of the TFEU

(see box) and mandate a single representative

for EMU. This raises the question as to why,

if the incentives for enhanced coordination

are clear, they have not done so. One explanation

for this draws on political economy models, which

predict that, where a potential policy change

provides marginal benefi ts to a larger group,

but imposes concentrated losses on a smaller

group, the views of the latter group may

prevail, as it has a greater incentive and capacity

to organise.

Applied to the external representation of EMU,

one could thus assert that the benefi ts of more

unifi ed representation accrue to a diffuse group –

the citizens of Europe – whose interests would be

more effectively represented on the international

stage. The losses are concentrated on a smaller

group – some euro area governments – that

would stand to lose their seat at the table

in international fora. However, there are a

number of new dynamics that may change the

cost-benefi t analysis applied by national

governments to more unifi ed representation.

NEW DYNAMICS IN EUROPEAN INTEGRATION

First, European integration is an ongoing

process. The Lisbon Treaty is very ambitious

and calls for important changes in the context

in which the EU conducts its external relations.

In particular, despite all obvious diffi culties,

the Treaty aims at strengthening Europe’s

voice on the world stage by enhancing the

overall consistency of and coherence between

the common foreign and security policy and

the external EU policies, particularly those

related to trade, development cooperation and

enlargement. To this end, a number of important

institutional changes have taken place. The new

position of High Representative of the Union for

Foreign Affairs and Security Policy (the holder

of which is, at the same time, the Vice-President

of the European Commission responsible

for external relations) aims at unifying the

EU’s external representation on foreign and

security policy issues with that on external

EU competences. The establishment of the

European External Action Service, supported

by a global network of EU delegations, aims

at setting up an EU diplomatic service that is

intended to progressively coordinate the EU’s

bilateral relationships with third countries,

as well as its multilateral relations. The position

of an elected President of the European Council,

also created by the Lisbon Treaty, provides an

external representative for foreign and security

policy issues at the level of the Heads of State

or Government.

These developments imply that, for issues of

global relevance, the EU is called upon to become

progressively the appropriate level at which to

coordinate action. This overall development

may also create favourable dynamics for the

external representation of EMU, all the more

so as the importance of economic cooperation

at the international level has increased since the

onset of the crisis. Indeed, the aspiration for a

more unifi ed EU foreign policy may eventually

need also to be supported by a more coherent

external stance on EMU matters or, by the EMU

members particularly, on global economic and

fi nancial matters more generally.

Moreover, the frameworks that govern economic

and fi nancial policies in the EU have been

reinforced, or are currently being enhanced.

Measures aimed at making economic governance

more comprehensive and stringent refl ect a key

lesson drawn from the crisis, namely that

national discretion in the exercise of fi scal and

broader macroeconomic policies must be geared

towards supporting the stability of EMU as a

whole.6 The same logic informs the substantial

strengthening of the framework for coordinating

supervisory policies at the EU level through the

establishment of the European System of

More information on this issue is provided in the article entitled 6

“The reform of economic governance in the euro area: essential

elements”, Monthly Bulletin, ECB, March 2011.

96ECB

Monthly Bulletin

May 2011

Financial Supervision.7 The crisis is also leading

to a reinforcement in EU fi nancial regulation

and has been setting the stage for greater

European cooperation in the area of fi nancial

crisis management and resolution. These

developments impose tighter boundaries on

national discretion over economic and fi nancial

policies than previously and reinforce the need

and incentive to cooperate in their external

representation. In addition, the establishment

of the European Stability Mechanism (ESM)

from 2013 onwards will provide a permanent

framework for euro area authorities to provide

fi nancial assistance to euro area countries in

fi nancial diffi culties. This will further reinforce

the incentive for a single euro area voice. To the

extent that fi nancial assistance is provided

together with the IMF, it may also lead to a

stronger voice for the euro area in the IMF.

NEW DYNAMICS IN INTERNATIONAL COOPERATION

There are also important developments taking

place at the international level that may affect

how EU and euro area governments weigh the

benefi ts of more unifi ed representation. The

recent crisis has led to an increased recognition of

the economic importance and systemic relevance

of emerging market economies and thus the need

to better integrate these countries into global

governance. Emerging markets represent about

one-third of world GDP at market exchange rates

and close to a half in purchasing power parity

(PPP). Current IMF projections show that the

weight of emerging market economies in world

GDP will increase further to 39% at market

exchange rates and 53% in PPP in 2015. While

the increased role of emerging countries was a

trend that was acknowledged before the global

fi nancial crisis, the crisis has accelerated the

need for changes to global governance and to

strengthen its legitimacy.

A fi rst visible adjustment was – as mentioned

above – the increased role of the G20 fi nance

ministers and central bank governors and the

organisation of regular meetings at the level of

the Heads of State or Government. The Financial

Stability Forum was expanded into the Financial

Stability Board, with its broader membership

now largely overlapping that of the G20.

As regards the IMF, even before the crisis there

had been extensive discussions on the need to

reform its governance framework in order to

increase its legitimacy and effi ciency. In this

context, signifi cant attention has been devoted

to the weight of emerging markets in terms of

quotas in the institution and the size and

composition of the IMF Executive Board.

In November 2010, as part of a comprehensive

reform package, the Board agreed – following a

political agreement achieved in the G20 – fi rst,

to shift quota and voting shares from advanced

to emerging markets, and second, to reduce the

number of Executive Directors representing

advanced European countries in an all-elected

Board by two in favour of emerging markets.8

The EU and the euro area, together with the

non-EU European countries, will now have to

decide how to meet this commitment by the

end of 2012. The increasing economic weight

of emerging markets will translate over time

into them accounting for even larger weights

in the IMF and corresponding lower weights

for advanced economies, including European

countries. Given that Europe is bound to see its

relative economic weight somewhat diminishing

and has to free up space in the IMF’s

decision-making bodies, it would seem advisable

for the euro area to take a proactive approach.

The changing international environment and

the new dynamics in the European integration

process provide a strong rationale for the EU and

euro area to reassess the external representation

of EU and EMU issues. In addition to the growing

interlinkages between economies, the current

crisis has illustrated how different policy areas

are intertwined. This requires comprehensive

For more information, in particular on the European Systemic 7

Risk Board, please refer to Chapter 6 of the ECB’s Annual

Report 2010.

The agreement refers to Executive Directors representing 8

advanced European countries, which implies that a solution

will also have to take into account advanced non-EU countries,

in particular Switzerland and Norway.

97ECB

Monthly Bulletin

May 2011

ARTICLES

The external

representation of

the EU and EMU

policy responses, covering macroeconomic,

regulatory and supervisory as well as governance

aspects. To effectively infl uence the global

debate on all of these issues, Europe is well

advised to reinforce its efforts to speak with a

single voice.

This requires that EU Member States,

as a minimum, step up internal coordination

processes and adhere to jointly agreed policy

lines when the relevant issues are discussed

in international fora. However, more efforts

will be needed to make Europe’s voice on the

international stage commensurate with its

economic weight. The current dispersion of

European representation is not only suboptimal

from an effectiveness and effi ciency perspective

when trying to pursue EU and EMU interests,

but it is also increasingly at odds with the

expectations of international partners. Pursuing

efforts towards a consolidation of European

representation will remain a useful policy

instrument for promoting the articulation of

Europe’s voice in international policy debates in

the coming years.

S 1ECB

Monthly Bulletin

May 2011

EURO AREA STATISTICS

S 3ECB

Monthly Bulletin

May 2011

CONTENTS 1

For further information, please contact us at: statistics@ecb.europa.eu. See the ECB’s Statistical Data Warehouse in the “Statistics” section of the ECB’s website 1

(http://sdw.ecb.europa.eu) for longer runs and more detailed data.

EURO AREA OVERVIEW

Summary of economic indicators for the euro area S5

1 MONETARY POLICY STATISTICS

1.1 Consolidated fi nancial statement of the Eurosystem S6

1.2 Key ECB interest rates S7

1.3 Eurosystem monetary policy operations allotted through tender procedures S8

1.4 Minimum reserve and liquidity statistics S9

2 MONEY, BANKING AND INVESTMENT FUNDS

2.1 Aggregated balance sheet of euro area MFIs S10

2.2 Consolidated balance sheet of euro area MFIs S11

2.3 Monetary statistics S12

2.4 MFI loans: breakdown S14

2.5 Deposits held with MFIs: breakdown S17

2.6 MFI holdings of securities: breakdown S20

2.7 Revaluation of selected MFI balance sheet items S21

2.8 Currency breakdown of selected MFI balance sheet items S22

2.9 Aggregated balance sheet of euro area investment funds S24

2.10 Securities held by investment funds broken down by issuer of securities S25

3 EURO AREA ACCOUNTS

3.1 Integrated economic and fi nancial accounts by institutional sector S26

3.2 Euro area non-fi nancial accounts S30

3.3 Households S32

3.4 Non-fi nancial corporations S33

3.5 Insurance corporations and pension funds S34

4 FINANCIAL MARKETS

4.1 Securities other than shares by original maturity, residency of the issuer and currency S35

4.2 Securities other than shares issued by euro area residents, by sector of the issuer and instrument type S36

4.3 Growth rates of securities other than shares issued by euro area residents S38

4.4 Quoted shares issued by euro area residents S40

4.5 MFI interest rates on euro-denominated deposits from and loans to euro area residents S42

4.6 Money market interest rates S44

4.7 Euro area yield curves S45

4.8 Stock market indices S46

5 PRICES, OUTPUT, DEMAND AND LABOUR MARKETS

5.1 HICP, other prices and costs S47

5.2 Output and demand S50

5.3 Labour markets S54

6 GOVERNMENT FINANCE

6.1 Revenue, expenditure and defi cit/surplus S56

6.2 Debt S57

6.3 Change in debt S58

6.4 Quarterly revenue, expenditure and defi cit/surplus S59

6.5 Quarterly debt and change in debt S60

S 4

Conventions used in the tables

“-” data do not exist/data are not applicable

“.” data are not yet available

“…” nil or negligible

“billion” 109

(p) provisional

s.a. seasonally adjusted

n.s.a. non-seasonally adjusted

ECB

Monthly Bulletin

May 2011

7 EXTERNAL TRANSACTIONS AND POSITIONS

7.1 Summary balance of payments S61

7.2 Current and capital accounts S62

7.3 Financial account S64

7.4 Monetary presentation of the balance of payments S70

7.5 Trade in goods S71

8 EXCHANGE RATES

8.1 Effective exchange rates S73

8.2 Bilateral exchange rates S74

9 DEVELOPMENTS OUTSIDE THE EURO AREA

9.1 In other EU Member States S75

9.2 In the United States and Japan S76

LIST OF CHARTS S77

TECHNICAL NOTES S79

GENERAL NOTES S85

ENLARGEMENT OF THE EURO AREA ON 1 JANUARY 2011 TO INCLUDE ESTONIA

In January 2011 Estonia joined the euro area, bringing the number of euro area countries to 17.

Unless otherwise indicated, all data series including observations for 2011 relate to the “Euro 17” (i.e. the euro area

including Estonia) for the whole time series. For interest rates, monetary statistics, the HICP and reserve assets (and, for

consistency reasons, the components and counterparts of M3 and the components of the HICP), euro area statistical series

take into account the changing composition of the euro area.

Detailed information on the current and past compositions of the euro area can be found in the General Notes.

EURO AREA OVERVIEW

Summary of economic indicators for the euro area (annual percentage changes, unless otherwise indicated)

S 5ECB

Monthly BulletinMay 2011

1. Monetary developments and interest rates 1)

M1 2) M2 2) M3 2), 3) M3 2), 3) MFI loans to Securities other 3-month 10-year3-month euro area than shares issued interest rate spot rate

moving average residents in euro by non-MFI (EURIBOR; (% per annum;(centred) excluding MFIs corporations 2) % per annum; end of

and general period period) 4)

government 2) averages)

1 2 3 4 5 6 7 8

2009 9.5 4.8 3.3 - 1.6 23.4 1.22 3.762010 8.5 1.8 0.5 - 0.6 4.1 0.81 3.36

2010 Q2 10.3 1.5 -0.1 - 0.2 4.2 0.69 3.03 Q3 7.8 1.7 0.7 - 0.9 2.1 0.87 2.67 Q4 4.9 2.2 1.5 - 1.7 2.3 1.02 3.362011 Q1 3.2 2.4 1.9 - 2.4 . 1.10 3.66

2010 Nov. 4.6 2.3 2.1 1.6 2.0 3.0 1.04 3.11 Dec. 4.3 2.2 1.7 1.8 1.9 2.2 1.02 3.36

2011 Jan. 3.2 2.3 1.5 1.8 2.4 2.4 1.02 3.49 Feb. 2.9 2.4 2.1 2.0 2.6 2.7 1.09 3.49 Mar. 3.0 2.6 2.3 . 2.5 . 1.18 3.66 Apr. . . . . . . 1.32 3.55

2. Prices, output, demand and labour markets 5)

HICP 1) Industrial Hourly Real GDP Industrial Capacity Employment Unemploymentproducer labour (s.a.) production utilisation in (s.a.) (% of labour

prices costs excluding manufacturing force; s.a.)construction (%)

1 2 3 4 5 6 7 8

2009 0.3 -5.1 2.9 -4.1 -14.7 70.9 -1.9 9.62010 1.6 2.9 1.5 1.8 7.5 77.0 -0.5 10.1

2010 Q3 1.7 4.0 0.9 2.0 7.2 77.8 -0.2 10.1 Q4 2.0 4.7 1.6 2.0 8.1 79.3 0.2 10.12011 Q1 2.5 6.4 . . . 80.8 . 9.9

2010 Nov. 1.9 4.5 - - 8.2 - - 10.1 Dec. 2.2 5.4 - - 8.9 - - 10.0

2011 Jan. 2.3 6.0 - - 6.3 80.3 - 10.0 Feb. 2.4 6.6 - - 7.5 - - 9.9 Mar. 2.7 6.7 - - . - - 9.9 Apr. 2.8 . - - . 81.3 - .

3. External statistics(EUR billions, unless otherwise indicated)

Balance of payments (net transactions) Reserve assets Net Gross Effective exchange rate of USD/EUR

(end-of-period international external debt the euro: EER-20 6) exchange rateCurrent and Combined positions) investment (as a % of GDP) (index: 1999 Q1 = 100)

capital Goods direct and positionaccounts portfolio (as a % of GDP) Nominal Real (CPI)

investment1 2 3 4 5 6 7 8 9

2009 -19.1 37.5 13.4 462.4 -16.4 116.1 111.7 110.6 1.39482010 -28.9 20.7 5.4 591.2 -12.9 117.8 104.6 103.0 1.3257

2010 Q2 -16.9 3.3 21.3 583.3 -13.5 123.4 103.1 101.8 1.2708 Q3 -5.1 8.2 -15.9 552.2 -15.1 120.3 102.3 100.8 1.2910 Q4 8.5 7.6 23.0 591.2 -12.9 117.8 104.4 102.4 1.35832011 Q1 . . . 572.8 . . 103.7 101.5 1.3680

2010 Nov. -2.9 -0.1 59.3 597.5 . . 104.7 102.7 1.3661 Dec. 7.6 1.3 23.3 591.2 . . 102.6 100.5 1.3220

2011 Jan. -20.4 -14.1 -11.6 562.3 . . 102.4 100.3 1.3360 Feb. -7.3 -1.0 71.3 577.5 . . 103.4 101.1 1.3649 Mar. . . . 572.8 . . 105.2 103.0 1.3999 Apr. . . . . . . 107.0 104.9 1.4442

Sources: ECB, European Commission (Eurostat and Economic and Financial Affairs DG) and Thomson Reuters.Note: For more information on the data, see the relevant tables later in this section.1) Data refer to the changing composition of the euro area. For further information, see the General Notes.2) Annual percentage changes for monthly data refer to the end of the month, whereas those for quarterly and yearly data refer to the annual change in the period average.

See the Technical Notes for details.3) M3 and its components exclude holdings by non-euro area residents of money market fund shares/units and debt securities with a maturity of up to two years.4) Based on AAA-rated euro area central government bond yield curves. For further information, see Section 4.7.5) Data refer to the Euro 17, unless otherwise indicated.6) For a definition of the trading partner groups and other information, please refer to the General Notes.

1 MONETARY POLICY STATISTICS

1.1 Consolidated financial statement of the Eurosystem (EUR millions)

S 6ECBMonthly BulletinMay 2011

1. Assets

8 April 2011 15 April 2011 22 April 2011 29 April 2011

Gold and gold receivables 350,668 350,672 350,668 350,668 Claims on non-euro area residents in foreign currency 219,625 219,274 218,059 216,815 Claims on euro area residents in foreign currency 24,204 23,603 23,510 23,267 Claims on non-euro area residents in euro 23,094 24,895 23,157 22,371 Lending to euro area credit institutions in euro 407,660 418,409 421,478 434,259 Main refinancing operations 84,533 94,134 97,372 117,883 Longer-term refinancing operations 322,855 324,042 324,042 316,310 Fine-tuning reverse operations 0 0 0 0 Structural reverse operations 0 0 0 0 Marginal lending facility 249 201 31 3 Credits related to margin calls 23 33 33 63 Other claims on euro area credit institutions in euro 44,631 43,458 44,871 49,583 Securities of euro area residents in euro 471,626 470,422 471,916 472,059 Securities held for monetary policy purposes 137,513 136,598 136,595 136,520 Other securities 334,113 333,823 335,321 335,539 General government debt in euro 35,085 35,085 35,085 34,548 Other assets 296,517 299,200 299,138 290,533

Total assets 1,873,111 1,885,017 1,887,882 1,894,101

2. Liabilities

8 April 2011 15 April 2011 22 April 2011 29 April 2011

Banknotes in circulation 828,523 830,940 837,626 834,430 Liabilities to euro area credit institutions in euro 296,183 309,573 293,715 286,506 Current accounts (covering the minimum reserve system) 188,577 222,427 204,468 187,655 Deposit facility 30,522 9,999 13,104 27,338 Fixed-term deposits 77,000 77,000 76,000 71,403 Fine-tuning reverse operations 0 0 0 0 Deposits related to margin calls 84 147 143 110 Other liabilities to euro area credit institutions in euro 5,232 5,148 5,253 5,050 Debt certificates issued 0 0 0 0 Liabilities to other euro area residents in euro 68,378 65,556 74,645 92,249 Liabilities to non-euro area residents in euro 41,735 41,466 42,312 41,158 Liabilities to euro area residents in foreign currency 1,139 950 959 927 Liabilities to non-euro area residents in foreign currency 14,041 12,687 13,044 11,830 Counterpart of special drawing rights allocated by the IMF 52,613 52,613 52,613 52,612 Other liabilities 177,997 178,814 180,444 182,263 Revaluation accounts 305,890 305,890 305,890 305,890 Capital and reserves 81,379 81,379 81,379 81,185

Total liabilities 1,873,111 1,885,017 1,887,882 1,894,101

Source: ECB.

EURO AREASTATISTICS

Monetarypolicy

statistics

1.2 Key ECB interest rates (levels in percentages per annum; changes in percentage points)

S 7ECB

Monthly BulletinMay 2011

With effect from: 1) Deposit facility Main refinancing operations Marginal lending facility

Fixed rate tenders Variable rate tenders Fixed rate Minimum bid rate

Level Change Level Level Change Level Change

1 2 3 4 5 6 7

1999 1 Jan. 2.00 - 3.00 - - 4.50 - 4 2) 2.75 0.75 3.00 - ... 3.25 -1.25

22 2.00 -0.75 3.00 - ... 4.50 1.259 Apr. 1.50 -0.50 2.50 - -0.50 3.50 -1.005 Nov. 2.00 0.50 3.00 - 0.50 4.00 0.50

2000 4 Feb. 2.25 0.25 3.25 - 0.25 4.25 0.2517 Mar. 2.50 0.25 3.50 - 0.25 4.50 0.2528 Apr. 2.75 0.25 3.75 - 0.25 4.75 0.25

9 June 3.25 0.50 4.25 - 0.50 5.25 0.5028 3) 3.25 ... - 4.25 ... 5.25 ...

1 Sep. 3.50 0.25 - 4.50 0.25 5.50 0.256 Oct. 3.75 0.25 - 4.75 0.25 5.75 0.25

2001 11 May 3.50 -0.25 - 4.50 -0.25 5.50 -0.2531 Aug. 3.25 -0.25 - 4.25 -0.25 5.25 -0.2518 Sep. 2.75 -0.50 - 3.75 -0.50 4.75 -0.50

9 Nov. 2.25 -0.50 - 3.25 -0.50 4.25 -0.50

2002 6 Dec. 1.75 -0.50 - 2.75 -0.50 3.75 -0.50

2003 7 Mar. 1.50 -0.25 - 2.50 -0.25 3.50 -0.256 June 1.00 -0.50 - 2.00 -0.50 3.00 -0.50

2005 6 Dec. 1.25 0.25 - 2.25 0.25 3.25 0.25

2006 8 Mar. 1.50 0.25 - 2.50 0.25 3.50 0.2515 June 1.75 0.25 - 2.75 0.25 3.75 0.25

9 Aug. 2.00 0.25 - 3.00 0.25 4.00 0.2511 Oct. 2.25 0.25 - 3.25 0.25 4.25 0.2513 Dec. 2.50 0.25 - 3.50 0.25 4.50 0.25

2007 14 Mar. 2.75 0.25 - 3.75 0.25 4.75 0.2513 June 3.00 0.25 - 4.00 0.25 5.00 0.25

2008 9 July 3.25 0.25 - 4.25 0.25 5.25 0.258 Oct. 2.75 -0.50 - - - 4.75 -0.509 4) 3.25 0.50 - - - 4.25 -0.50

15 5) 3.25 ... 3.75 - -0.50 4.25 ... 12 Nov. 2.75 -0.50 3.25 - -0.50 3.75 -0.5010 Dec. 2.00 -0.75 2.50 - -0.75 3.00 -0.75

2009 21 Jan. 1.00 -1.00 2.00 - -0.50 3.00 ... 11 Mar. 0.50 -0.50 1.50 - -0.50 2.50 -0.50

8 Apr. 0.25 -0.25 1.25 - -0.25 2.25 -0.2513 May 0.25 ... 1.00 - -0.25 1.75 -0.50

2011 13 Apr. 0.50 0.25 1.25 - 0.25 2.00 0.25

Source: ECB.1) From 1 January 1999 to 9 March 2004, the date refers to the deposit and marginal lending facilities. For main refinancing operations, changes in the rate are effective from the

first operation following the date indicated. The change on 18 September 2001 was effective on that same day. From 10 March 2004 onwards, the date refers both to the depositand marginal lending facilities and to the main refinancing operations (with changes effective from the first main refinancing operation following the Governing Councildecision), unless otherwise indicated.

2) On 22 December 1998 the ECB announced that, as an exceptional measure between 4 and 21 January 1999, a narrow corridor of 50 basis points would be applied between theinterest rates for the marginal lending facility and the deposit facility, aimed at facilitating the transition to the new monetary regime by market participants.

3) On 8 June 2000 the ECB announced that, starting from the operation to be settled on 28 June 2000, the main refinancing operations of the Eurosystem would be conducted asvariable rate tenders. The minimum bid rate refers to the minimum interest rate at which counterparties may place their bids.

4) As of 9 October 2008 the ECB reduced the standing facilities corridor from 200 basis points to 100 basis points around the interest rate on the main refinancing operations.The standing facilities corridor was restored to 200 basis points as of 21 January 2009.

5) On 8 October 2008 the ECB announced that, starting from the operation to be settled on 15 October, the weekly main refinancing operations would be carried out through afixed rate tender procedure with full allotment at the interest rate on the main refinancing operations. This change overrode the previous decision (made on the same day)to cut by 50 basis points the minimum bid rate on the main refinancing operations conducted as variable rate tenders.

1.3 Eurosystem monetary policy operations allotted through tender procedures 1), 2) (EUR millions; interest rates in percentages per annum)

S 8ECBMonthly BulletinMay 2011

1. Main and longer-term refinancing operations 3)

Main refinancing operations

Date of Bids Number of Allotment Fixed rate tender Variable rate tender Running for

settlement (amount) participants (amount) procedures procedures (...) days

Fixed rate Minimum Marginal Weightedbid rate rate 4) average rate

1 2 3 4 5 6 7 8

2011 19 Jan. 176,904 171 176,904 1.00 - - - 726 165,603 209 165,603 1.00 - - - 7

2 Feb. 213,725 371 213,725 1.00 - - - 79 156,710 220 156,710 1.00 - - - 7

16 137,015 253 137,015 1.00 - - - 723 119,455 189 119,455 1.00 - - - 7

2 Mar. 124,442 182 124,442 1.00 - - - 79 111,331 185 111,331 1.00 - - - 7

16 100,543 177 100,543 1.00 - - - 723 89,417 173 89,417 1.00 - - - 730 100,439 174 100,439 1.00 - - - 7

6 Apr. 84,533 161 84,533 1.00 - - - 713 94,134 161 94,134 1.25 - - - 720 97,372 181 97,372 1.25 - - - 727 117,883 241 117,883 1.25 - - - 7

4 May 127,538 326 127,538 1.25 - - - 7

Longer-term refinancing operations

2010 10 Nov. 63,618 44 63,618 1.00 - - - 2825 5) 38,211 189 38,211 1.00 - - - 91

8 Dec. 68,066 56 68,066 1.00 - - - 4223 5) 149,466 270 149,466 1.00 - - - 98

2011 19 Jan. 70,351 45 70,351 1.00 - - - 2127 5) 71,143 165 71,143 1.04 - - - 91

9 Feb. 61,472 42 61,472 1.00 - - - 2824 5) 39,755 192 39,755 . - - - 91

9 Mar. 82,500 52 82,500 1.00 - - - 3531 5) 129,458 290 129,458 . - - - 9113 Apr. 83,687 40 83,687 1.25 - - - 2828 5) 63,411 177 63,411 . - - - 91

2. Other tender operations

Date of settlement Type of Bids Number of Allotment Fixed rate tender Variable rate tender Running

operation (amount) participants (amount) procedures procedures for(...) days

Fixed rate Minimum Maximum Marginal Weightedbid rate bid rate rate 4) average rate

1 2 3 4 5 6 7 8 9 10

2011 9 Feb. Collection of fixed-term deposits 93,341 66 76,500 - - 1.00 0.95 0.87 716 Collection of fixed-term deposits 102,784 73 76,500 - - 1.00 0.80 0.71 723 Collection of fixed-term deposits 95,494 74 77,000 - - 1.00 0.70 0.58 7

2 Mar. Collection of fixed-term deposits 91,911 71 77,500 - - 1.00 0.65 0.56 78 Collection of fixed-term deposits 96,572 141 95,812 - - 1.00 0.80 0.79 19 Collection of fixed-term deposits 95,585 65 77,500 - - 1.00 0.90 0.83 7

16 Collection of fixed-term deposits 119,307 74 77,500 - - 1.00 0.69 0.66 723 Collection of fixed-term deposits 106,704 63 77,500 - - 1.00 0.70 0.64 730 Collection of fixed-term deposits 77,320 58 76,500 - - 1.00 1.00 0.72 7

6 Apr. Collection of fixed-term deposits 121,130 76 77,000 - - 1.00 0.64 0.59 712 Collection of fixed-term deposits 81,342 131 78,871 - - 1.00 0.80 0.79 113 Collection of fixed-term deposits 102,562 71 77,000 - - 1.25 1.12 1.05 720 Collection of fixed-term deposits 88,974 68 76,000 - - 1.25 1.21 1.12 727 Collection of fixed-term deposits 71,403 49 71,403 - - 1.25 1.25 1.17 7

4 May Collection of fixed-term deposits 62,177 58 62,177 - - 1.25 1.25 1.16 7 Source: ECB.1) The amounts shown may differ slightly from those in Section 1.1 owing to operations that have been allotted but not settled.2) With effect from April 2002, split tender operations (i.e. operations with a one-week maturity conducted as standard tender procedures in parallel with a main refinancing

operation) are classified as main refinancing operations. For split tender operations conducted before this month, see Table 2 in Section 1.3.3) On 8 June 2000 the ECB announced that, starting from the operation to be settled on 28 June 2000, the main refinancing operations of the Eurosystem would be conducted as

variable rate tender procedures. The minimum bid rate refers to the minimum interest rate at which counterparties may place their bids. On 8 October 2008 the ECB announcedthat, starting from the operation to be settled on 15 October 2008, the weekly main refinancing operations would be carried out through a fixed rate tender procedure with fullallotment at the interest rate on the main refinancing operations. On 4 March 2010 the ECB decided to return to variable rate tender procedures in the regular three-monthlonger-term refinancing operations, starting with the operation to be allotted on 28 April 2010 and settled on 29 April 2010.

4) In liquidity-providing (absorbing) operations, the marginal rate refers to the lowest (highest) rate at which bids were accepted.5) In the longer-term refinancing operations settled on 17 December 2009, 1 April, 13 May, 28 October, 25 November and 23 December 2010, and 27 January, 24 February,

31 March and 28 April 2011, the rate at which all bids were satisfied was indexed to the average minimum bid rate in the main refinancing operations over the lifeof the operation.

EURO AREASTATISTICS

Monetarypolicy

statistics

1.4 Minimum reserve and liquidity statistics (EUR billions; period averages of daily positions, unless otherwise indicated; interest rates as percentages per annum)

S 9ECB

Monthly BulletinMay 2011

1. Reserve base of credit institutions subject to reserve requirements

Reserve Total Liabilities to which a 2% reserve coefficient is applied Liabilities to which a 0% reserve coefficient is applied

baseas at: 1) Overnight deposits and Debt securities Deposits with an agreed Repos Debt securities

deposits with an agreed maturity issued with a maturity maturity or notice period issued with a maturityor notice period of up to 2 years of up to 2 years of over 2 years of over 2 years

1 2 3 4 5 6

2008 18,169.6 10,056.8 848.7 2,376.9 1,243.5 3,643.72009 18,318.2 9,808.5 760.4 2,475.7 1,170.1 4,103.52010 18,948.1 9,962.6 644.3 2,683.3 1,335.4 4,322.5

2010 Oct. 2) 18,986.4 9,901.3 658.2 2,632.7 1,399.4 4,394.9 Nov. 2) 19,190.9 9,970.1 669.9 2,715.6 1,465.9 4,369.5 Dec. 2) 18,948.1 9,962.6 644.3 2,683.3 1,335.4 4,322.5

2011 Jan. 19,024.1 9,840.2 651.6 2,780.6 1,395.8 4,356.0 Feb. 19,035.9 9,768.6 670.3 2,727.5 1,490.3 4,379.2

2. Reserve maintenance

Maintenance Required Credit institutions’ Excess Deficiencies Interest rate onperiod reserves current accounts reserves minimum reserves

ending on:1 2 3 4 5

2009 210.2 211.4 1.2 0.0 1.002010 211.8 212.5 0.7 0.5 1.00

2010 9 Nov. 214.0 215.2 1.2 0.0 1.007 Dec. 211.8 212.5 0.7 0.5 1.00

2011 18 Jan. 3) 210.5 212.4 1.9 0.0 1.008 Feb. 212.3 213.6 1.3 0.0 1.008 Mar. 211.6 212.9 1.3 0.0 1.00

12 Apr. 209.3 210.5 1.1 0.0 1.00

3. Liquidity

Maintenance Liquidity-providing factors Liquidity-absorbing factors Credit Base

period institutions’ moneyending on: Monetary policy operations of the Eurosystem current

accountsEurosystem’s Main Longer-term Marginal Other Deposit Other Banknotes Central Other

net assets refinancing refinancing lending liquidity- facility liquidity- in government factorsin gold operations operations facility providing absorbing circulation deposits (net)

and foreign operations 4) operations 5) with thecurrency Eurosystem

1 2 3 4 5 6 7 8 9 10 11 12

2009 407.6 55.8 593.4 0.7 24.6 65.7 9.9 775.2 150.1 -130.2 211.4 1,052.32010 511.1 179.5 336.3 1.9 130.4 44.7 70.8 815.9 94.4 -79.1 212.5 1,073.1

2010 9 Nov. 511.3 183.0 340.0 0.8 124.5 41.9 68.8 813.5 92.1 -72.0 215.2 1,070.77 Dec. 511.1 179.5 336.3 1.9 130.4 44.7 70.8 815.9 94.4 -79.1 212.5 1,073.1

2011 18 Jan. 527.5 197.0 316.6 0.5 140.9 66.5 73.5 833.8 81.3 -84.9 212.4 1,112.78 Feb. 549.7 185.4 318.2 0.1 137.2 39.2 81.3 822.0 101.2 -66.7 213.6 1,074.88 Mar. 550.0 134.4 321.0 7.6 137.9 26.9 80.3 820.9 89.8 -79.9 212.9 1,060.7

12 Apr. 544.1 97.3 335.4 0.8 137.6 23.0 79.5 824.4 73.1 -95.2 210.5 1,057.9

Source: ECB.1) End of period.2) Includes the reserve bases of credit institutions in Estonia. On a transitional basis, credit institutions located in the euro area may have decided to deduct from their own reserve

bases any liabilities owed to credit institutions located in Estonia. As of the reserve base as at end-January 2011, the standard treatment applies (see Decision ECB/2010/18 ofthe ECB of 26 October 2010 on transitional provisions for the application of minimum reserves by the ECB following the introduction of the euro in Estonia).

3) Owing to the adoption of the euro by Estonia on 1 January 2011, the reserve requirement is an average - weighted by the number of calendar days - of the reserve requirementsfor the then 16 countries of the euro area for the period 8-31 December 2010 and the reserve requirements for the 17 countries now in the euro area for the period1-18 January 2011.

4) Includes liquidity provided under the Eurosystem’s covered bond purchase programme and the Eurosystem’s securities markets programme.5) Includes liquidity absorbed as a result of the Eurosystem’s foreign exchange swap operations.

For more information, please see: http://www.ecb.europa.eu/mopo/liq/html/index.en.html

2 MONEY, BANKING AND INVESTMENT FUNDS

2.1 Aggregated balance sheet of euro area MFIs 1) (EUR billions; outstanding amounts at end of period)

S 10ECBMonthly BulletinMay 2011

1. Assets

Eurosystem

Total Loans to euro area residents Holdings of securities other than Money Holdings External Fixed Remaining

shares issued by euro area residents market of shares/ assets assets assets 3)

fund other equityTotal General Other MFIs Total General Other MFIs shares/ issued by

government euro area government euro area units 2) euro arearesidents residents residents

1 2 3 4 5 6 7 8 9 10 11 12 13 14

2009 2,829.9 1,475.6 19.5 0.7 1,455.4 451.7 368.3 7.5 75.9 - 16.5 556.7 8.5 321.02010 3,212.4 1,537.5 18.6 0.9 1,517.9 570.7 460.0 9.6 101.1 - 18.1 683.8 8.5 393.9

2010 Q4 3,212.4 1,537.5 18.6 0.9 1,517.9 570.7 460.0 9.6 101.1 - 18.1 683.8 8.5 393.92011 Q1 (p) 3,038.5 1,347.2 18.5 1.0 1,327.7 580.8 468.5 9.8 102.5 - 19.5 670.3 8.5 412.2

2010 Oct. 3,028.1 1,449.8 18.5 0.9 1,430.4 559.3 448.8 9.7 100.8 - 17.0 643.6 8.7 349.7 Nov. 3,117.8 1,467.0 18.5 0.9 1,447.5 561.8 451.0 9.7 101.2 - 16.6 689.3 8.7 374.3 Dec. 3,212.4 1,537.5 18.6 0.9 1,517.9 570.7 460.0 9.6 101.1 - 18.1 683.8 8.5 393.9

2011 Jan. 3,101.7 1,446.1 18.6 1.0 1,426.6 577.4 466.4 9.7 101.3 - 18.5 657.4 8.5 393.8 Feb. 3,113.7 1,418.1 18.6 0.9 1,398.5 581.6 469.4 9.9 102.3 - 19.5 674.6 8.5 411.5 Mar. (p) 3,038.5 1,347.2 18.5 1.0 1,327.7 580.8 468.5 9.8 102.5 - 19.5 670.3 8.5 412.2

MFIs excluding the Eurosystem

2009 31,144.9 17,702.4 1,001.7 10,783.3 5,917.5 5,060.6 1,483.2 1,497.2 2,080.2 85.1 1,235.1 4,251.7 220.7 2,589.22010 32,202.9 17,763.4 1,220.0 11,027.1 5,516.4 4,945.3 1,524.0 1,535.4 1,885.9 59.9 1,232.5 4,319.7 223.5 3,658.6

2010 Q4 32,202.9 17,763.4 1,220.0 11,027.1 5,516.4 4,945.3 1,524.0 1,535.4 1,885.9 59.9 1,232.5 4,319.7 223.5 3,658.62011 Q1 (p) 31,697.3 17,726.5 1,186.8 11,116.1 5,423.5 4,904.7 1,534.5 1,500.8 1,869.4 59.5 1,244.9 4,278.9 224.4 3,258.5

2010 Oct. 31,861.3 17,818.6 1,153.5 10,959.0 5,706.2 5,109.7 1,665.7 1,521.9 1,922.1 61.4 1,251.6 4,331.7 220.6 3,067.6 Nov. 31,966.0 17,847.9 1,209.1 11,068.7 5,570.1 5,100.1 1,610.4 1,554.0 1,935.7 61.5 1,251.0 4,457.5 222.4 3,025.6 Dec. 32,202.9 17,763.4 1,220.0 11,027.1 5,516.4 4,945.3 1,524.0 1,535.4 1,885.9 59.9 1,232.5 4,319.7 223.5 3,658.6

2011 Jan. 32,118.3 17,815.4 1,217.6 11,065.6 5,532.1 4,959.3 1,542.5 1,522.8 1,893.9 60.6 1,250.9 4,356.2 223.7 3,452.3 Feb. 32,108.6 17,817.3 1,198.1 11,112.9 5,506.3 4,975.7 1,547.5 1,530.4 1,897.8 61.9 1,243.4 4,376.6 223.6 3,410.0 Mar. (p) 31,697.3 17,726.5 1,186.8 11,116.1 5,423.5 4,904.7 1,534.5 1,500.8 1,869.4 59.5 1,244.9 4,278.9 224.4 3,258.5

2. Liabilities

Eurosystem

Total Currency Deposits of euro area residents Money Debt Capital External Remaining

in market securities and liabilities liabilities 3)

circulation Total Central Other general MFIs fund issued 5) reservesgovernment government/ shares/

other euro units 4)

area residents

1 2 3 4 5 6 7 8 9 10 11

2009 2,829.9 829.3 1,192.3 102.6 22.1 1,067.6 - 0.1 320.9 140.0 347.42010 3,212.4 863.7 1,394.6 68.0 8.7 1,318.0 - 0.0 429.8 153.5 370.8

2010 Q4 3,212.4 863.7 1,394.6 68.0 8.7 1,318.0 - 0.0 429.8 153.5 370.82011 Q1 (p) 3,038.5 848.4 1,264.8 60.8 8.9 1,195.2 - 0.0 403.9 154.7 366.8

2010 Oct. 3,028.1 838.7 1,294.6 100.6 12.6 1,181.3 - 0.0 406.2 130.7 357.9 Nov. 3,117.8 840.5 1,331.1 98.5 16.5 1,216.2 - 0.0 436.2 139.6 370.4 Dec. 3,212.4 863.7 1,394.6 68.0 8.7 1,318.0 - 0.0 429.8 153.5 370.8

2011 Jan. 3,101.7 845.4 1,334.0 113.1 9.9 1,211.1 - 0.0 398.0 153.5 370.7 Feb. 3,113.7 844.4 1,327.5 96.7 10.1 1,220.6 - 0.0 416.7 158.1 367.1 Mar. (p) 3,038.5 848.4 1,264.8 60.8 8.9 1,195.2 - 0.0 403.9 154.7 366.8

MFIs excluding the Eurosystem

2009 31,144.9 - 16,470.9 144.1 10,044.8 6,282.0 732.6 4,908.5 1,921.2 4,097.7 3,013.92010 32,202.9 - 16,504.0 196.2 10,532.4 5,775.4 612.3 4,844.6 2,044.8 4,219.2 3,977.9

2010 Q4 32,202.9 - 16,504.0 196.2 10,532.4 5,775.4 612.3 4,844.6 2,044.8 4,219.2 3,977.92011 Q1 (p) 31,697.3 - 16,411.6 238.5 10,537.4 5,635.7 630.4 4,887.6 2,076.3 4,031.5 3,659.9

2010 Oct. 31,861.3 - 16,570.2 243.1 10,343.0 5,984.1 635.7 4,853.5 2,026.3 4,325.1 3,450.5 Nov. 31,966.0 - 16,542.1 262.4 10,452.8 5,826.9 648.1 4,903.0 2,018.0 4,443.9 3,410.8 Dec. 32,202.9 - 16,504.0 196.2 10,532.4 5,775.4 612.3 4,844.6 2,044.8 4,219.2 3,977.9

2011 Jan. 32,118.3 - 16,480.5 203.4 10,476.8 5,800.3 603.2 4,878.2 2,061.3 4,260.9 3,834.2 Feb. 32,108.6 - 16,494.2 233.1 10,511.7 5,749.4 611.7 4,900.3 2,074.0 4,251.6 3,776.7 Mar. (p) 31,697.3 - 16,411.6 238.5 10,537.4 5,635.7 630.4 4,887.6 2,076.3 4,031.5 3,659.9

Source: ECB.1) Data refer to the changing composition of the euro area. For further information, see the General Notes.2) Amounts issued by euro area residents. Amounts issued by non-euro area residents are included in external assets.3) In December 2010 a change was made to the recording practice for derivatives in one Member State, leading to an increase in this position.4) Amounts held by euro area residents.5) Amounts issued with a maturity of up to two years and held by non-euro area residents are included in external liabilities.

EURO AREASTATISTICS

Money,banking

andinvestment

funds

2.2 Consolidated balance sheet of euro area MFIs 1) (EUR billions; outstanding amounts at end of period; transactions during period)

S 11ECB

Monthly BulletinMay 2011

1. Assets

Outstanding amounts

Total Loans to euro area residents Holdings of securities other than shares Holdings External Fixed Remaining

issued by euro area residents of shares/ assets assets assets 2)

other equityTotal General Other Total General Other issued by

government euro area government euro area other euro arearesidents residents residents

1 2 3 4 5 6 7 8 9 10 11

2009 23,861.8 11,805.0 1,021.1 10,783.9 3,356.2 1,851.5 1,504.6 812.1 4,808.4 229.2 2,850.82010 25,827.6 12,266.6 1,238.6 11,028.0 3,529.0 1,984.0 1,545.0 799.2 5,003.5 232.0 3,997.3

2010 Q4 25,827.6 12,266.6 1,238.6 11,028.0 3,529.0 1,984.0 1,545.0 799.2 5,003.5 232.0 3,997.32011 Q1 (p) 25,449.1 12,322.4 1,205.4 11,117.1 3,513.6 2,003.0 1,510.7 809.7 4,949.2 232.8 3,621.3

2010 Oct. 25,154.9 12,131.9 1,172.0 10,959.9 3,646.1 2,114.4 1,531.6 804.7 4,975.3 229.4 3,367.6 Nov. 25,466.2 12,297.3 1,227.6 11,069.7 3,625.1 2,061.4 1,563.7 816.3 5,146.8 231.2 3,349.6 Dec. 25,827.6 12,266.6 1,238.6 11,028.0 3,529.0 1,984.0 1,545.0 799.2 5,003.5 232.0 3,997.3

2011 Jan. 25,702.0 12,302.8 1,236.3 11,066.6 3,541.5 2,008.9 1,532.5 815.0 5,013.6 232.2 3,796.9 Feb. 25,752.0 12,330.6 1,216.7 11,113.9 3,557.2 2,016.9 1,540.3 807.5 5,051.2 232.1 3,773.4 Mar. (p) 25,449.1 12,322.4 1,205.4 11,117.1 3,513.6 2,003.0 1,510.7 809.7 4,949.2 232.8 3,621.3

Transactions

2009 -644.9 15.2 29.4 -14.2 365.1 269.8 95.3 12.6 -465.4 7.8 -581.02010 606.7 408.7 205.5 203.1 134.6 132.5 2.2 6.9 -109.1 2.4 153.8

2010 Q4 -377.2 193.6 138.0 55.6 -11.5 -6.1 -5.4 11.7 -111.8 3.6 -462.82011 Q1 (p) -271.3 40.8 -26.9 67.7 -8.5 22.3 -30.8 8.1 84.8 0.8 -397.2

2010 Oct. -2.6 62.7 79.5 -16.8 82.2 107.6 -25.3 5.5 -38.3 0.7 -115.4 Nov. 149.9 146.8 54.7 92.1 -3.2 -37.7 34.5 17.1 15.4 1.8 -28.1 Dec. -524.5 -15.9 3.8 -19.7 -90.5 -75.9 -14.6 -10.9 -88.9 1.1 -319.4

2011 Jan. -75.9 22.8 -2.4 25.2 11.8 23.4 -11.6 13.7 86.2 0.1 -210.5 Feb. 19.5 10.8 -13.4 24.2 18.5 10.4 8.1 -8.5 31.6 -0.1 -32.8 Mar. (p) -214.9 7.2 -11.1 18.2 -38.8 -11.5 -27.3 2.9 -33.0 0.8 -153.9

2. Liabilities

Outstanding amounts

Total Currency in Deposits of Deposits of Money market Debt Capital External Remaining Excess ofcirculation central other general fund shares/ securities and liabilities liabilities 2) inter-MFI

government government/ units 3) issued 4) reserves liabilitiesother euro area over inter-MFI

residents assets

1 2 3 4 5 6 7 8 9 10

2009 23,861.8 769.9 246.7 10,066.9 647.5 2,752.5 1,802.6 4,237.7 3,361.3 -23.32010 25,827.6 808.6 264.2 10,541.1 552.4 2,857.7 2,023.2 4,372.7 4,348.7 59.1

2010 Q4 25,827.6 808.6 264.2 10,541.1 552.4 2,857.7 2,023.2 4,372.7 4,348.7 59.12011 Q1 (p) 25,449.1 798.9 299.3 10,546.2 571.0 2,915.8 2,025.5 4,186.2 4,026.7 79.6

2010 Oct. 25,154.9 789.0 343.7 10,355.6 574.3 2,830.5 1,968.5 4,455.9 3,808.4 28.8 Nov. 25,466.2 790.2 360.8 10,469.3 586.5 2,866.2 2,002.9 4,583.5 3,781.2 25.5 Dec. 25,827.6 808.6 264.2 10,541.1 552.4 2,857.7 2,023.2 4,372.7 4,348.7 59.1

2011 Jan. 25,702.0 796.2 316.4 10,486.7 542.6 2,883.0 2,005.0 4,414.4 4,204.9 52.7 Feb. 25,752.0 796.2 329.9 10,521.8 549.9 2,900.2 2,035.3 4,409.6 4,143.8 65.3 Mar. (p) 25,449.1 798.9 299.3 10,546.2 571.0 2,915.8 2,025.5 4,186.2 4,026.7 79.6

Transactions

2009 -644.9 45.8 -4.4 289.4 -12.5 -56.4 143.2 -591.1 -505.6 46.62010 606.7 38.6 16.7 327.2 -97.0 39.3 112.2 -27.6 138.9 58.3

2010 Q4 -377.2 21.7 -1.9 151.8 -34.8 2.2 45.2 -88.0 -523.8 50.32011 Q1 (p) -271.3 -9.9 34.6 -12.0 -6.7 83.6 13.1 -49.5 -340.1 15.6

2010 Oct. -2.6 2.2 78.1 -0.8 -14.9 6.6 6.8 44.2 -142.1 17.4 Nov. 149.9 1.2 17.1 73.9 12.9 -1.6 21.8 7.2 20.5 -3.1 Dec. -524.5 18.4 -97.1 78.7 -32.8 -2.8 16.7 -139.3 -402.3 36.1

2011 Jan. -75.9 -12.6 51.8 -57.5 -9.8 29.5 -2.6 81.3 -151.4 -4.6 Feb. 19.5 0.0 13.4 16.6 4.7 21.1 15.9 10.0 -68.2 6.0 Mar. (p) -214.9 2.7 -30.6 29.0 -1.7 33.1 -0.2 -140.9 -120.5 14.2

Source: ECB.1) Data refer to the changing composition of the euro area. For further information, see the General Notes.2) In December 2010 a change was made to the recording practice for derivatives in one Member State, leading to an increase in this position.3) Amounts held by euro area residents.4) Amounts issued with a maturity of up to two years and held by non-euro area residents are included in external liabilities.

2.3 Monetary statistics 1) (EUR billions and annual growth rates; seasonally adjusted; outstanding amounts and growth rates at end of period; transactions during period)

S 12ECBMonthly BulletinMay 2011

1. Monetary aggregates 2) and counterparts

Outstanding amounts

M3 M3 Longer-term Credit to Credit to other euro area residents Net

3-month financial general external M2 M3-M2 moving liabilities government Loans Memo item: Loans assets 3)

average adjustedM1 M2-M1 (centred) for sales and

securitisation 4)

1 2 3 4 5 6 7 8 9 10 11 12

2009 4,502.1 3,701.6 8,203.7 1,134.3 9,338.0 - 6,764.0 2,910.8 13,104.0 10,792.3 - 552.42010 4,706.0 3,694.0 8,400.1 1,124.8 9,524.9 - 7,319.2 3,264.6 13,372.1 11,034.5 - 612.5

2010 Q4 4,706.0 3,694.0 8,400.1 1,124.8 9,524.9 - 7,319.2 3,264.6 13,372.1 11,034.5 - 612.52011 Q1 (p) 4,715.7 3,740.3 8,456.0 1,147.5 9,603.5 - 7,379.2 3,211.2 13,461.3 11,129.2 - 773.5

2010 Nov. 4,695.4 3,707.4 8,402.8 1,136.3 9,539.1 - 7,304.9 3,293.3 13,417.1 11,051.1 - 554.1 Dec. 4,706.0 3,694.0 8,400.1 1,124.8 9,524.9 - 7,319.2 3,264.6 13,372.1 11,034.5 - 612.5

2011 Jan. 4,696.5 3,717.8 8,414.3 1,080.7 9,495.0 - 7,326.4 3,258.1 13,427.5 11,078.5 - 586.2 Feb. 4,697.5 3,734.1 8,431.6 1,113.2 9,544.7 - 7,397.9 3,244.6 13,500.7 11,142.0 - 625.1 Mar. (p) 4,715.7 3,740.3 8,456.0 1,147.5 9,603.5 - 7,379.2 3,211.2 13,461.3 11,129.2 - 773.5

Transactions

2009 493.8 -368.0 125.8 -160.0 -34.2 - 422.4 307.2 90.0 -15.3 24.7 125.32010 193.1 -14.2 178.8 -23.2 155.7 - 262.4 342.1 208.8 201.4 247.3 -81.5

2010 Q4 17.1 4.9 22.0 -0.2 21.8 - 82.4 176.4 59.9 78.5 104.2 -36.22011 Q1 (p) 15.6 40.3 55.8 -5.8 50.0 - 82.1 -43.8 69.0 73.2 47.8 163.0

2010 Nov. -1.4 -6.8 -8.2 59.4 51.2 - 44.6 22.7 85.2 60.0 72.2 10.9 Dec. 13.9 -10.7 3.2 -10.7 -7.5 - 17.9 -34.4 -12.7 5.4 7.8 41.3

2011 Jan. -12.1 21.8 9.7 -44.2 -34.5 - 28.2 -8.1 40.8 30.6 19.4 10.1 Feb. 6.3 10.1 16.4 29.4 45.8 - 43.8 -5.0 49.4 40.3 44.8 18.1 Mar. (p) 21.4 8.3 29.8 8.9 38.7 - 10.2 -30.7 -21.2 2.3 -16.4 134.8

Growth rates

2009 12.3 -9.0 1.6 -11.8 -0.4 -0.2 6.7 11.8 0.7 -0.1 0.2 125.32010 4.3 -0.4 2.2 -2.1 1.7 1.8 3.8 11.7 1.6 1.9 2.3 -81.5

2010 Q4 4.3 -0.4 2.2 -2.1 1.7 1.8 3.8 11.7 1.6 1.9 2.3 -81.52011 Q1 (p) 3.0 2.2 2.6 -0.2 2.3 2.0 3.9 7.7 2.2 2.5 2.8 79.5

2010 Nov. 4.6 -0.5 2.3 0.4 2.1 1.6 4.0 12.9 1.9 2.0 2.3 -83.5 Dec. 4.3 -0.4 2.2 -2.1 1.7 1.8 3.8 11.7 1.6 1.9 2.3 -81.5

2011 Jan. 3.2 1.1 2.3 -3.9 1.5 1.8 3.5 11.6 2.1 2.4 2.7 -82.5 Feb. 2.9 1.8 2.4 -0.3 2.1 2.0 4.1 10.5 2.3 2.6 3.0 -45.6 Mar. (p) 3.0 2.2 2.6 -0.2 2.3 . 3.9 7.7 2.2 2.5 2.8 79.5

C1 Monetary aggregates 1)

(annual growth rates; seasonally adjusted)

C2 Counterparts 1)

(annual growth rates; seasonally adjusted)

-5

0

5

10

15

20

2000 2002 2004 2006 2008 2010-5

0

5

10

15

20

M1M3

-10

-5

0

5

10

15

20

2000 2002 2004 2006 2008 2010-10

-5

0

5

10

15

20

longer-term financial liabilitiescredit to general governmentloans to other euro area residents

Source: ECB.1) Data refer to the changing composition of the euro area. For further information, see the General Notes.

Monthly and other shorter-term growth rates for selected items are available at: http://www.ecb.europa.eu/stats/money/aggregates/aggr/html/index.en.html2) Monetary liabilities of MFIs and central government (post office, treasury, etc.) vis-à-vis non-MFI euro area residents excluding central government.

For definitions of M1, M2 and M3, see glossary.3) Values in the section ‘‘growth rates’’ are sums of the transactions during the 12 months ending in the period indicated.4) Adjustment for the derecognition of loans on the MFI balance sheet on account of their sale or securitisation.

EURO AREASTATISTICS

Money,banking

andinvestment

funds

2.3 Monetary statistics 1) (EUR billions and annual growth rates; seasonally adjusted; outstanding amounts and growth rates at end of period; transactions during period)

S 13ECB

Monthly BulletinMay 2011

2. Components of monetary aggregates and longer-term financial liabilities

Outstanding amounts

Currency Overnight Deposits Deposits Repos Money Debt Debt Deposits Deposits Capitalin deposits with an agreed redeemable market securities with securities with redeemable with an agreed and

circulation maturity of up at notice of fund a maturity of a maturity of at notice of maturity of reservesto 2 years up to 3 months shares/units up to 2 years over 2 years over 3 months over 2 years

1 2 3 4 5 6 7 8 9 10 11

2009 757.5 3,744.6 1,896.8 1,804.8 334.3 668.1 131.9 2,634.9 132.5 2,207.9 1,788.82010 793.6 3,912.4 1,783.8 1,910.3 433.1 570.2 121.5 2,752.6 118.4 2,441.9 2,006.3

2010 Q4 793.6 3,912.4 1,783.8 1,910.3 433.1 570.2 121.5 2,752.6 118.4 2,441.9 2,006.32011 Q1 (p) 803.3 3,912.5 1,819.6 1,920.6 431.4 571.2 144.8 2,768.0 119.6 2,463.5 2,028.1

2010 Nov. 795.9 3,899.4 1,794.2 1,913.2 430.8 585.4 120.1 2,751.2 119.0 2,439.9 1,994.9 Dec. 793.6 3,912.4 1,783.8 1,910.3 433.1 570.2 121.5 2,752.6 118.4 2,441.9 2,006.3

2011 Jan. 802.6 3,894.0 1,807.7 1,910.1 407.2 547.2 126.3 2,763.3 118.6 2,446.2 1,998.2 Feb. 804.8 3,892.7 1,815.8 1,918.2 440.2 548.1 124.9 2,782.8 119.4 2,459.2 2,036.6 Mar. (p) 803.3 3,912.5 1,819.6 1,920.6 431.4 571.2 144.8 2,768.0 119.6 2,463.5 2,028.1

Transactions

2009 44.3 449.4 -605.2 237.2 -12.6 -13.1 -134.3 78.2 9.0 194.0 141.22010 36.0 157.0 -127.5 113.2 94.5 -100.0 -17.7 58.3 -14.1 109.3 108.9

2010 Q4 2.9 14.2 -12.7 17.6 28.7 -21.0 -7.9 26.7 -3.9 29.2 30.52011 Q1 (p) 9.4 6.2 35.3 5.0 -4.2 -24.3 22.6 41.6 1.2 6.7 32.5

2010 Nov. 4.2 -5.6 -15.8 9.1 55.4 6.6 -2.6 8.6 -1.0 19.7 17.2 Dec. -2.3 16.2 -8.2 -2.6 2.4 -13.8 0.7 7.8 -0.6 2.9 7.9

2011 Jan. 8.7 -20.8 22.8 -1.0 -25.9 -23.0 4.6 15.1 0.2 5.4 7.5 Feb. 2.3 4.0 6.7 3.5 33.0 -1.7 -1.9 23.9 0.7 -4.7 23.9 Mar. (p) -1.6 23.0 5.9 2.5 -11.3 0.4 19.9 2.7 0.3 6.0 1.2

Growth rates

2009 6.2 13.6 -24.2 15.1 -3.5 -1.9 -50.2 3.0 7.3 9.7 8.72010 4.8 4.2 -6.7 6.3 28.1 -14.9 -13.1 2.2 -10.7 4.8 5.9

2010 Q4 4.8 4.2 -6.7 6.3 28.1 -14.9 -13.1 2.2 -10.7 4.8 5.92011 Q1 (p) 3.7 2.8 -0.3 4.8 22.8 -13.3 0.9 2.6 -9.4 3.9 6.7

2010 Nov. 5.6 4.4 -7.7 7.3 36.3 -13.2 -13.7 1.8 -11.0 4.9 7.2 Dec. 4.8 4.2 -6.7 6.3 28.1 -14.9 -13.1 2.2 -10.7 4.8 5.9

2011 Jan. 5.4 2.7 -3.2 5.6 25.4 -17.0 -10.0 1.8 -10.3 4.2 6.3 Feb. 5.1 2.4 -1.6 5.2 31.3 -15.3 -6.6 3.0 -9.3 3.6 7.2 Mar. (p) 3.7 2.8 -0.3 4.8 22.8 -13.3 0.9 2.6 -9.4 3.9 6.7

C3 Components of monetary aggregates 1)

(annual growth rates; seasonally adjusted)

C4 Components of longer-term financial liabilities 1)

(annual growth rates; seasonally adjusted)

-40

-20

0

20

40

60

2000 2002 2004 2006 2008 2010-40

-20

0

20

40

60

currency in circulationovernight depositsdeposits redeemable at notice of up to 3 months

-5

0

5

10

15

20

2000 2002 2004 2006 2008 2010-5

0

5

10

15

20

debt securities with a maturity of over 2 yearsdeposits with an agreed maturity of over 2 yearscapital and reserves

Source: ECB.1) Data refer to the changing composition of the euro area. For further information, see the General Notes.

2.4 MFI loans: breakdown 1), 2) (EUR billions and annual growth rates; seasonally adjusted; outstanding amounts and growth rates at end of period; transactions during period)

S 14ECBMonthly BulletinMay 2011

1. Loans to financial intermediaries, non-financial corporations and households

Outstanding amounts

Insurance Other

corporations financial Non-financial corporations Households 4) and pension funds intermediaries 3)

Total Total Total Up to Over 1 Over Total Consumer Loans Other1 year and up to 5 years credit for house loans

5 years purchase1 2 3 4 5 6 7 8 9 10

2009 88.9 1,060.4 4,690.9 1,187.7 937.6 2,565.5 4,952.0 631.1 3,546.6 774.32010 94.8 1,112.8 4,668.0 1,127.0 898.6 2,642.5 5,158.9 639.4 3,701.2 818.3

2010 Q4 94.8 1,112.8 4,668.0 1,127.0 898.6 2,642.5 5,158.9 639.4 3,701.2 818.32011 Q1 (p) 91.5 1,113.6 4,702.8 1,149.2 893.0 2,660.6 5,221.2 633.7 3,761.9 825.6

2010 Nov. 96.3 1,112.3 4,696.2 1,136.0 907.2 2,653.0 5,146.3 641.8 3,684.9 819.7 Dec. 94.8 1,112.8 4,668.0 1,127.0 898.6 2,642.5 5,158.9 639.4 3,701.2 818.3

2011 Jan. 93.2 1,104.7 4,694.2 1,148.0 898.0 2,648.2 5,186.5 636.7 3,723.1 826.8 Feb. 97.0 1,144.9 4,706.9 1,153.5 897.5 2,655.9 5,193.2 635.7 3,727.1 830.4 Mar. (p) 91.5 1,113.6 4,702.8 1,149.2 893.0 2,660.6 5,221.2 633.7 3,761.9 825.6

Transactions

2009 -13.7 40.6 -107.0 -181.3 -18.9 93.2 64.9 -1.2 51.4 14.72010 7.0 54.6 -7.2 -42.1 -22.1 57.0 147.0 -6.1 132.6 20.5

2010 Q4 2.6 40.1 -15.6 -5.0 -15.3 4.8 51.4 -0.6 45.7 6.32011 Q1 (p) -3.2 -21.0 38.0 20.6 -2.7 20.2 59.4 -2.5 58.5 3.5

2010 Nov. 3.3 35.2 6.5 3.0 -4.0 7.5 15.0 2.2 8.0 4.8 Dec. -1.1 2.2 -16.8 -6.3 -6.4 -4.0 21.1 -1.9 23.0 0.0

2011 Jan. -1.6 -7.0 18.6 17.1 -1.6 3.1 20.7 -0.7 18.0 3.4 Feb. 3.8 13.8 16.8 4.5 1.9 10.4 6.0 -0.6 4.3 2.2 Mar. (p) -5.4 -27.8 2.7 -1.0 -3.0 6.7 32.8 -1.2 36.1 -2.1

Growth rates

2009 -13.3 4.1 -2.2 -13.1 -2.0 3.7 1.3 -0.2 1.5 1.92010 7.9 5.0 -0.2 -3.6 -2.4 2.2 2.9 -1.0 3.7 2.6

2010 Q4 7.9 5.0 -0.2 -3.6 -2.4 2.2 2.9 -1.0 3.7 2.62011 Q1 (p) 5.6 5.7 0.8 -0.4 -1.8 2.3 3.4 -0.9 4.4 2.1

2010 Nov. 14.0 6.7 -0.2 -4.4 -1.9 2.4 2.8 -0.4 3.5 2.3 Dec. 7.9 5.0 -0.2 -3.6 -2.4 2.2 2.9 -1.0 3.7 2.6

2011 Jan. 7.2 7.1 0.5 -1.6 -1.9 2.3 3.1 -0.8 3.9 2.7 Feb. 8.6 8.7 0.6 -1.0 -1.8 2.2 3.0 -0.7 3.8 2.6 Mar. (p) 5.6 5.7 0.8 -0.4 -1.8 2.3 3.4 -0.9 4.4 2.1

C5 Loans to other financial intermediaries and non-financial

corporations 2) (annual growth rates; not seasonally adjusted)

C6 Loans to households 2)

(annual growth rates; not seasonally adjusted)

-5

0

5

10

15

20

25

30

35

2000 2002 2004 2006 2008 2010-5

0

5

10

15

20

25

30

35

other financial intermediariesnon-financial corporations

-2

0

2

4

6

8

10

12

14

2000 2002 2004 2006 2008 2010-2

0

2

4

6

8

10

12

14

consumer creditloans for house purchaseother loans

Source: ECB.1) MFI sector excluding the Eurosystem; sectoral classification is based on the ESA 95.2) Data refer to the changing composition of the euro area. For further information, see the General Notes.3) Including investment funds.4) Including non-profit institutions serving households.

EURO AREASTATISTICS

Money,banking

andinvestment

funds

2.4 MFI loans: breakdown 1), 2) (EUR billions and annual growth rates; not seasonally adjusted; outstanding amounts and growth rates at end of period; transactions during period)

S 15ECB

Monthly BulletinMay 2011

2. Loans to financial intermediaries and non-financial corporations

Outstanding amounts

Insurance corporations and pension funds Other financial intermediaries 3) Non-financial corporations

Total Up to Over 1 Over Total Up to Over 1 Over Total Up to Over 1 Over1 year and up to 5 years 1 year and up to 5 years 1 year and up to 5 years

5 years 5 years 5 years1 2 3 4 5 6 7 8 9 10 11 12

2010 86.0 66.6 5.2 14.3 1,105.4 587.5 206.6 311.3 4,668.0 1,120.2 898.2 2,649.6

2010 Q4 86.0 66.6 5.2 14.3 1,105.4 587.5 206.6 311.3 4,668.0 1,120.2 898.2 2,649.62011 Q1 (p) 90.5 71.4 5.8 13.3 1,112.5 586.7 210.0 315.7 4,701.9 1,150.1 893.1 2,658.7

2011 Jan. 90.7 71.3 5.1 14.3 1,093.1 583.7 199.2 310.2 4,699.5 1,151.4 896.4 2,651.7 Feb. 94.5 74.3 5.8 14.3 1,128.3 599.7 214.6 314.0 4,705.7 1,153.8 895.8 2,656.1 Mar. (p) 90.5 71.4 5.8 13.3 1,112.5 586.7 210.0 315.7 4,701.9 1,150.1 893.1 2,658.7

Transactions

2010 6.8 10.1 -1.8 -1.5 56.1 17.5 8.5 30.1 -7.5 -42.3 -22.1 56.9

2010 Q4 -7.4 -6.9 -0.6 0.1 17.6 1.0 5.5 11.2 -9.3 -9.8 -15.9 16.42011 Q1 (p) 4.6 4.9 0.6 -0.9 -14.8 -5.3 -11.2 1.8 37.1 28.2 -2.2 11.1

2011 Jan. 4.7 4.8 -0.1 0.0 -11.2 -2.7 -7.7 -0.7 23.9 27.2 -2.9 -0.5 Feb. 3.8 3.0 0.7 0.0 8.8 8.6 0.5 -0.3 10.3 1.4 1.8 7.1 Mar. (p) -3.9 -2.9 0.0 -1.0 -12.4 -11.3 -4.0 2.8 2.9 -0.4 -1.1 4.5

Growth rates

2010 8.4 17.5 -25.2 -9.4 5.2 2.8 4.0 10.6 -0.2 -3.6 -2.4 2.2

2010 Q4 8.4 17.5 -25.2 -9.4 5.2 2.8 4.0 10.6 -0.2 -3.6 -2.4 2.22011 Q1 (p) 5.6 11.2 0.6 -15.2 5.6 4.6 1.6 10.0 0.8 -0.4 -1.8 2.2

2011 Jan. 6.8 15.9 -29.1 -11.6 7.0 7.2 2.1 9.5 0.5 -1.6 -1.9 2.3 Feb. 8.6 13.5 3.2 -9.7 8.6 10.2 2.6 9.1 0.6 -0.9 -1.8 2.2 Mar. (p) 5.6 11.2 0.6 -15.2 5.6 4.6 1.6 10.0 0.8 -0.4 -1.8 2.2

3. Loans to households 4)

Outstanding amounts

Total Consumer credit Loans for house purchase Other loans

Total Up to Over 1 Over Total Up to Over 1 Over Total Up to Over 1 Over1 year and up to 5 years 1 year and up to 5 years 1 year and up to 5 years

5 years 5 years 5 years1 2 3 4 5 6 7 8 9 10 11 12 13

2010 5,167.6 641.8 147.1 186.5 308.3 3,706.8 14.7 54.9 3,637.1 819.0 146.2 85.7 587.1

2010 Q4 5,167.6 641.8 147.1 186.5 308.3 3,706.8 14.7 54.9 3,637.1 819.0 146.2 85.7 587.12011 Q1 (p) 5,211.2 630.4 138.8 184.5 307.1 3,756.4 14.0 55.2 3,687.2 824.4 149.4 85.1 589.9

2011 Jan. 5,182.3 633.8 142.5 184.8 306.6 3,722.7 14.4 54.8 3,653.5 825.8 148.9 85.5 591.3 Feb. 5,184.4 630.4 140.5 184.0 305.9 3,725.2 14.0 55.0 3,656.1 828.9 148.6 85.6 594.6 Mar. (p) 5,211.2 630.4 138.8 184.5 307.1 3,756.4 14.0 55.2 3,687.2 824.4 149.4 85.1 589.9

Transactions

2010 147.4 -6.2 -3.3 -8.8 5.9 133.2 -0.6 -3.7 137.5 20.4 -8.7 -4.4 33.4

2010 Q4 54.5 -0.2 3.2 -2.5 -0.9 47.5 0.1 -2.1 49.5 7.2 0.7 -1.0 7.52011 Q1 (p) 40.7 -8.2 -6.2 -1.9 -0.1 47.3 -0.8 0.2 47.9 1.6 0.1 -1.4 2.9

2011 Jan. 7.8 -6.0 -2.9 -1.8 -1.3 12.1 -0.4 -0.2 12.6 1.6 -0.6 -0.7 2.9 Feb. 1.4 -3.0 -2.0 -0.9 -0.2 2.8 -0.4 0.3 2.9 1.6 -0.3 -0.5 2.4 Mar. (p) 31.6 0.8 -1.3 0.7 1.5 32.5 0.0 0.1 32.4 -1.7 1.0 -0.3 -2.4

Growth rates

2010 3.0 -1.0 -2.4 -4.5 2.0 3.7 -4.2 -6.2 3.9 2.6 -5.7 -5.0 6.1

2010 Q4 3.0 -1.0 -2.4 -4.5 2.0 3.7 -4.2 -6.2 3.9 2.6 -5.7 -5.0 6.12011 Q1 (p) 3.4 -0.9 -2.8 -4.3 2.2 4.4 -7.6 -3.3 4.6 2.1 -5.7 -5.6 5.5

2011 Jan. 3.1 -0.8 -3.2 -4.0 2.4 3.9 -6.1 -6.6 4.2 2.7 -6.2 -4.8 6.3 Feb. 3.0 -0.7 -2.4 -4.2 2.4 3.8 -7.9 -5.9 4.0 2.6 -6.4 -5.2 6.3 Mar. (p) 3.4 -0.9 -2.8 -4.3 2.2 4.4 -7.6 -3.3 4.6 2.1 -5.7 -5.6 5.5

Source: ECB.1) MFI sector excluding the Eurosystem; sectoral classification is based on the ESA 95.2) Data refer to the changing composition of the euro area. For further information, see the General Notes.3) Including investment funds.4) Including non-profit institutions serving households.

2.4 MFI loans: breakdown 1), 2) (EUR billions and annual growth rates; not seasonally adjusted; outstanding amounts and growth rates at end of period; transactions during period)

S 16ECBMonthly BulletinMay 2011

4. Loans to government and non-euro area residents

Outstanding amounts

General government Non-euro area residents

Total Central Other general government Total Banks 3) Non-banks

governmentState Local Social Total General Other

government government security governmentfunds

1 2 3 4 5 6 7 8 9 10

2008 973.3 232.0 209.8 509.3 22.2 3,242.4 2,278.8 963.6 57.5 906.12009 1,001.7 229.3 209.8 528.8 33.8 2,821.7 1,914.9 906.8 46.1 860.7

2010 Q1 1,032.5 242.3 209.0 538.9 42.2 2,949.9 1,985.1 964.8 46.8 918.0 Q2 1,072.9 255.2 225.0 547.9 44.8 3,076.4 2,074.4 1,001.6 50.9 950.7 Q3 1,073.9 262.1 223.2 544.1 44.5 2,952.1 1,995.7 956.0 51.8 904.2 Q4 (p) 1,220.0 393.2 225.2 552.9 45.8 2,962.1 2,009.3 952.2 49.5 902.7

Transactions

2008 13.7 12.5 -8.1 16.5 -7.2 -59.8 -86.0 26.1 0.3 25.82009 30.5 -2.7 0.1 21.6 11.5 -384.7 -345.5 -38.9 -1.5 -37.5

2010 Q1 30.4 12.6 -0.8 10.1 8.5 53.9 24.1 29.6 -0.6 30.2 Q2 36.5 9.2 15.9 9.0 2.6 -20.1 1.3 -22.7 -0.7 -22.0 Q3 1.6 7.7 -1.9 -3.8 -0.3 -11.0 -13.1 2.1 3.8 -1.7 Q4 (p) 137.9 126.2 2.0 8.8 1.3 -18.5 -3.6 -15.5 -2.0 -13.5

Growth rates

2008 1.4 5.7 -3.7 3.3 -24.4 -1.5 -3.6 2.8 0.5 3.02009 3.1 -1.2 0.1 4.2 51.9 -11.7 -15.1 -4.1 -3.0 -4.2

2010 Q1 6.6 4.0 1.8 5.8 101.2 -3.2 -5.4 1.7 -4.7 2.1 Q2 7.3 1.0 9.1 7.0 56.8 -1.3 -1.6 -1.4 -4.3 -1.2 Q3 7.9 9.9 6.5 5.4 45.1 0.9 1.3 -0.6 1.5 -0.8 Q4 (p) 20.6 67.1 7.3 4.6 35.7 0.5 0.5 -0.6 0.4 -0.7

C7 Loans to government 2)

(annual growth rates; not seasonally adjusted)

C8 Loans to non-euro area residents 2)

(annual growth rates; not seasonally adjusted)

-20

-10

0

10

20

30

40

50

60

70

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010-20

-10

0

10

20

30

40

50

60

70

central governmentother general government

-30

-20

-10

0

10

20

30

40

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010-30

-20

-10

0

10

20

30

40

non-resident banksnon-resident non-banks

Source: ECB.1) MFI sector excluding the Eurosystem; sectoral classification is based on the ESA 95.2) Data refer to the changing composition of the euro area. For further information, see the General Notes.3) The term ‘‘banks’’ is used in this table to indicate institutions similar to MFIs which are resident outside the euro area.

EURO AREASTATISTICS

Money,banking

andinvestment

funds

2.5 Deposits held with MFIs: breakdown 1), 2) (EUR billions and annual growth rates; outstanding amounts and growth rates at end of period; transactions during period)

S 17ECB

Monthly BulletinMay 2011

1. Deposits by financial intermediaries

Outstanding amounts

Insurance corporations and pension funds Other financial intermediaries 3)

Total Overnight With an agreed maturity of: Redeemable at notice of: Repos Total Overnight With an agreed maturity of: Redeemable at notice of: Repos

Up to Over 2 Up to Over Up to Over Up to Over2 years years 3 months 3 months 2 years 2 years 3 months 3 months

1 2 3 4 5 6 7 8 9 10 11 12 13 14

2009 738.5 84.1 86.9 543.7 2.2 1.4 20.2 1,872.5 313.1 335.1 957.5 15.9 0.0 250.92010 716.8 84.9 79.0 528.3 2.4 0.3 21.9 2,171.1 359.9 305.3 1,137.1 8.7 0.5 359.5

2010 Q4 716.8 84.9 79.0 528.3 2.4 0.3 21.9 2,171.1 359.9 305.3 1,137.1 8.7 0.5 359.52011 Q1 (p) 715.9 88.1 78.5 527.0 2.9 0.2 19.1 2,176.3 371.6 297.6 1,137.3 11.8 0.5 357.5

2010 Nov. 719.4 89.5 79.5 527.6 2.5 0.3 20.0 2,206.5 384.7 316.3 1,129.0 8.7 0.5 367.3 Dec. 716.8 84.9 79.0 528.3 2.4 0.3 21.9 2,171.1 359.9 305.3 1,137.1 8.7 0.5 359.5

2011 Jan. 730.9 97.7 80.0 527.9 2.6 0.2 22.5 2,139.9 381.6 293.5 1,129.3 8.9 0.5 326.1 Feb. 721.6 90.6 78.9 528.2 2.8 0.2 20.8 2,186.0 376.6 298.0 1,133.6 11.1 0.5 366.2 Mar. (p) 715.9 88.1 78.5 527.0 2.9 0.2 19.1 2,176.3 371.6 297.6 1,137.3 11.8 0.5 357.5

Transactions

2009 -26.8 -1.0 -30.4 6.3 1.1 -0.1 -2.7 56.8 6.8 -93.6 85.8 3.7 0.0 54.02010 -26.5 -3.2 -8.6 -16.6 0.2 0.0 1.6 153.9 43.3 -38.7 52.4 -7.8 0.4 104.3

2010 Q4 -18.0 -4.7 -10.3 -4.6 -0.2 0.0 1.8 24.2 -19.7 2.4 30.3 -0.3 -0.3 11.72011 Q1 (p) -0.8 3.6 -0.7 -1.2 0.3 0.0 -2.8 -6.3 15.7 -6.6 -14.7 1.0 0.1 -1.8

2010 Nov. -10.2 -0.2 -6.3 -2.2 0.0 0.0 -1.5 84.8 9.9 -3.2 29.6 -0.6 -0.1 49.3 Dec. -2.3 -4.5 -0.4 0.8 -0.1 0.0 1.9 -34.9 -23.4 -11.8 7.9 0.1 -0.1 -7.6

2011 Jan. 13.8 12.8 0.6 -0.4 0.1 0.0 0.6 -26.9 22.5 -9.5 -6.6 0.1 0.0 -33.4 Feb. -9.3 -6.9 -1.1 0.4 0.1 0.0 -1.7 26.7 -3.0 2.6 -13.4 0.2 0.0 40.1 Mar. (p) -5.3 -2.3 -0.2 -1.2 0.1 0.0 -1.7 -6.1 -3.8 0.2 5.3 0.7 0.0 -8.5

Growth rates

2009 -3.5 -1.1 -26.4 1.2 96.8 - -11.8 3.1 2.0 -22.0 10.0 30.0 - 27.42010 -3.6 -3.2 -9.8 -3.0 10.1 - 7.8 7.9 13.8 -11.4 4.8 -48.1 - 41.3

2010 Q4 -3.6 -3.2 -9.8 -3.0 10.1 - 7.8 7.9 13.8 -11.4 4.8 -48.1 - 41.32011 Q1 (p) -3.2 -2.2 -7.2 -2.6 6.5 - -5.9 7.8 13.8 -4.9 4.2 -46.7 - 30.4

2010 Nov. -3.0 0.6 -2.9 -3.5 23.7 - -7.5 9.5 16.2 -8.6 4.1 -49.6 - 52.2 Dec. -3.6 -3.2 -9.8 -3.0 10.1 - 7.8 7.9 13.8 -11.4 4.8 -48.1 - 41.3

2011 Jan. -2.4 -0.1 -4.7 -2.6 7.1 - 0.7 6.6 11.0 -10.7 4.1 -51.0 - 37.8 Feb. -2.7 -3.3 -8.6 -2.4 9.8 - 20.3 7.4 13.1 -9.7 3.2 -49.8 - 41.5 Mar. (p) -3.2 -2.2 -7.2 -2.6 6.5 - -5.9 7.8 13.8 -4.9 4.2 -46.7 - 30.4

C9 Total deposits by sector 2)

(annual growth rates)

C10 Total deposits and deposits included in M3

by sector 2) (annual growth rates)

-10

0

10

20

30

40

2000 2002 2004 2006 2008 2010-10

0

10

20

30

40

insurance corporations and pension funds (total)other financial intermediaries (total)

-20

-10

0

10

20

30

40

2004 2005 2006 2007 2008 2009 2010-20

-10

0

10

20

30

40

insurance corporations and pension funds (total)other financial intermediaries (total)insurance corporations and pension funds (included in M3)other financial intermediaries (included in M3)

Source: ECB.1) MFI sector excluding the Eurosystem; sectoral classification is based on the ESA 95.2) Data refer to the changing composition of the euro area. For further information, see the General Notes.3) Includes investment funds.4) Covers deposits in columns 2, 3, 5 and 7.5) Covers deposits in columns 9, 10, 12 and 14.

4)

5)

2.5 Deposits held with MFIs: breakdown 1), 2) (EUR billions and annual growth rates; outstanding amounts and growth rates at end of period; transactions during period)

S 18ECBMonthly BulletinMay 2011

2. Deposits by non-financial corporations and households

Outstanding amounts

Non-financial corporations Households 3)

TotalOvernight With an agreed maturity of: Redeemable at notice of: Repos TotalOvernight With an agreed maturity of: Redeemable at notice of: Repos

Up to Over 2 Up to Over Up to Over Up to Over2 years years 3 months 3 months 2 years 2 years 3 months 3 months

1 2 3 4 5 6 7 8 9 10 11 12 13 14

2009 1,603.1 1,001.1 434.5 80.7 68.7 1.7 16.3 5,601.8 2,157.0 996.5 607.1 1,680.2 123.7 37.32010 1,671.8 1,038.2 457.4 87.2 73.3 1.5 14.2 5,741.2 2,244.5 901.6 666.5 1,788.5 110.3 29.8

2010 Q4 1,671.8 1,038.2 457.4 87.2 73.3 1.5 14.2 5,741.2 2,244.5 901.6 666.5 1,788.5 110.3 29.82011 Q1 (p) 1,643.4 998.7 458.7 90.4 77.0 2.0 16.6 5,759.8 2,221.5 904.9 680.7 1,810.9 110.2 31.6

2010 Nov. 1,627.2 998.6 449.2 86.9 76.6 2.0 14.0 5,659.1 2,202.1 896.8 656.2 1,764.0 110.1 29.9 Dec. 1,671.8 1,038.2 457.4 87.2 73.3 1.5 14.2 5,741.2 2,244.5 901.6 666.5 1,788.5 110.3 29.8

2011 Jan. 1,614.9 988.9 448.8 88.2 76.5 1.5 11.0 5,754.2 2,233.9 905.6 670.5 1,804.0 110.0 30.1 Feb. 1,608.4 977.5 450.9 89.8 76.9 2.1 11.2 5,758.4 2,225.1 907.4 676.4 1,808.4 110.1 30.9 Mar. (p) 1,643.4 998.7 458.7 90.4 77.0 2.0 16.6 5,759.8 2,221.5 904.9 680.7 1,810.9 110.2 31.6

Transactions

2009 93.0 114.3 -70.1 15.1 40.8 0.4 -7.4 187.8 320.6 -371.5 85.9 190.5 8.6 -46.32010 75.5 38.9 22.1 8.9 7.9 -0.2 -2.1 135.0 82.3 -98.9 60.2 113.5 -14.6 -7.5

2010 Q4 71.8 46.0 22.8 2.4 -1.2 -0.6 2.4 89.6 41.8 4.9 13.9 31.1 -0.5 -1.62011 Q1 (p) -30.5 -36.8 1.8 3.3 1.0 0.6 -0.3 16.8 -24.0 2.9 14.1 22.0 -0.1 1.9

2010 Nov. 9.1 6.4 -3.2 0.8 2.5 -0.1 2.7 -15.4 -17.0 -1.1 0.8 2.2 0.6 -0.9 Dec. 50.0 41.0 10.9 1.5 -3.2 -0.5 0.2 82.9 42.9 5.1 10.1 24.8 0.2 -0.1

2011 Jan. -59.2 -50.9 -9.1 1.0 3.0 0.0 -3.2 9.8 -12.1 3.0 3.9 15.0 -0.3 0.3 Feb. -5.9 -8.5 2.3 1.6 -2.1 0.6 0.2 4.4 -8.7 2.0 5.9 4.5 0.1 0.8 Mar. (p) 34.6 22.6 8.5 0.7 0.1 0.0 2.7 2.5 -3.1 -2.1 4.3 2.5 0.1 0.8

Growth rates

2009 6.2 12.9 -13.9 23.1 146.6 28.3 -31.2 3.5 17.5 -27.1 16.5 12.8 7.5 -55.42010 4.7 3.9 5.0 11.1 11.6 -10.5 -12.8 2.4 3.8 -9.9 9.9 6.8 -11.7 -20.2

2010 Q4 4.7 3.9 5.0 11.1 11.6 -10.5 -12.8 2.4 3.8 -9.9 9.9 6.8 -11.7 -20.22011 Q1 (p) 4.7 2.3 8.1 12.5 6.5 12.7 10.8 2.7 2.6 -3.3 7.6 5.5 -10.4 -12.3

2010 Nov. 4.0 2.8 2.2 10.6 30.9 27.5 -5.8 2.4 4.6 -12.4 12.2 7.2 -12.6 -22.2 Dec. 4.7 3.9 5.0 11.1 11.6 -10.5 -12.8 2.4 3.8 -9.9 9.9 6.8 -11.7 -20.2

2011 Jan. 4.8 2.7 7.2 11.1 16.1 -13.8 -16.2 2.2 2.4 -6.3 8.8 5.9 -10.9 -18.7 Feb. 5.3 3.0 8.8 12.8 9.7 19.6 -4.0 2.3 1.9 -4.2 8.1 5.7 -10.4 -16.6 Mar. (p) 4.7 2.3 8.1 12.5 6.5 12.7 10.8 2.7 2.6 -3.3 7.6 5.5 -10.4 -12.3

C11 Total deposits by sector 2)

(annual growth rates)

C12 Total deposits and deposits included in M3

by sector 2) (annual growth rates)

-2

0

2

4

6

8

10

12

14

2000 2002 2004 2006 2008 2010-2

0

2

4

6

8

10

12

14

non-financial corporations (total)households (total)

-5

0

5

10

15

20

2004 2005 2006 2007 2008 2009 2010-5

0

5

10

15

20

non-financial corporations (total)households (total)non-financial corporations (included in M3)households (included in M3)

Source: ECB.1) MFI sector excluding the Eurosystem; sectoral classification is based on the ESA 95.2) Data refer to the changing composition of the euro area. For further information, see the General Notes.3) Including non-profit institutions serving households.4) Covers deposits in columns 2, 3, 5 and 7.5) Covers deposits in columns 9, 10, 12 and 14.

4)

5)

EURO AREASTATISTICS

Money,banking

andinvestment

funds

2.5 Deposits held with MFIs: breakdown 1), 2) (EUR billions and annual growth rates; outstanding amounts and growth rates at end of period; transactions during period)

S 19ECB

Monthly BulletinMay 2011

3. Deposits by government and non-euro area residents

Outstanding amounts

General government Non-euro area residents

Total Central Other general government Total Banks 3) Non-banks

governmentState Local Social Total General Other

government government security governmentfunds

1 2 3 4 5 6 7 8 9 10

2008 444.7 190.8 52.1 116.1 85.8 3,713.3 2,816.2 897.1 65.6 831.52009 373.0 144.1 43.4 114.3 71.2 3,368.7 2,532.7 836.0 56.7 779.3

2010 Q1 397.6 166.2 50.4 108.4 72.6 3,543.7 2,639.0 904.7 66.8 837.9 Q2 412.6 167.6 54.5 113.7 76.8 3,700.4 2,693.4 1,007.0 46.7 960.4 Q3 421.4 176.2 58.7 111.9 74.5 3,580.5 2,597.1 983.4 47.8 935.5 Q4 (p) 427.6 196.2 47.7 109.6 74.1 3,487.6 2,490.7 996.9 45.9 951.0

Transactions

2008 72.7 63.4 -6.5 8.7 7.1 -183.3 -165.8 -17.5 -36.8 19.32009 -64.7 -38.1 -8.7 -2.5 -15.0 -331.2 -275.4 -55.8 -4.5 -51.32010 (p) 53.9 51.3 4.3 -4.9 2.9 -0.2 -80.3 79.3 7.4 71.8

2010 Q1 24.6 22.1 7.0 -5.9 1.0 95.3 49.6 45.7 9.1 36.6 Q2 14.6 1.3 4.1 5.1 4.2 -9.5 -26.3 16.8 -2.3 19.1 Q3 9.2 8.5 4.3 -1.8 -1.8 17.3 5.5 11.5 3.2 8.3 Q4 (p) 5.4 19.3 -11.0 -2.2 -0.5 -103.3 -109.2 5.3 -2.5 7.8

Growth rates

2008 19.4 49.9 -11.0 8.1 8.8 -4.4 -5.6 -1.7 -25.6 2.72009 -14.6 -19.9 -16.7 -2.1 -17.4 -8.8 -9.8 -6.2 -7.0 -6.2

2010 Q1 -12.0 -17.2 -0.1 -5.4 -13.2 -3.5 -5.3 2.4 12.0 1.7 Q2 -11.0 -20.6 11.6 -4.7 -6.0 -2.0 -4.0 3.6 6.9 3.3 Q3 4.5 12.3 15.0 -9.3 4.2 0.7 -1.1 5.6 14.5 5.1 Q4 (p) 14.5 35.6 9.8 -4.3 4.1 0.3 -3.1 9.2 13.4 8.9

C13 Deposits by government and non-euro area residents 2)

(annual growth rates)

-20

-15

-10

-5

0

5

10

15

20

25

30

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010-20

-15

-10

-5

0

5

10

15

20

25

30

general governmentnon-resident banksnon-resident non-banks

Source: ECB.1) MFI sector excluding the Eurosystem; sectoral classification is based on the ESA 95.2) Data refer to the changing composition of the euro area. For further information, see the General Notes.3) The term ‘‘banks’’ is used in this table to indicate institutions similar to MFIs which are resident outside the euro area.

2.6 MFI holdings of securities: breakdown 1), 2) (EUR billions and annual growth rates; outstanding amounts and growth rates at end of period; transactions during period)

S 20ECBMonthly BulletinMay 2011

Outstanding amounts

Securities other than shares Shares and other equity

Total MFIs General Other euro Non-euro area Total MFIs Non-MFIs Non-euro area

government area residents residents residents

Euro Non-euro Euro Non-euro Euro Non-euro

1 2 3 4 5 6 7 8 9 10 11 12

2009 6,207.7 1,971.1 109.1 1,467.2 16.0 1,457.8 39.4 1,147.1 1,515.3 434.6 800.5 280.22010 5,996.9 1,778.5 107.4 1,507.5 16.4 1,507.6 27.8 1,051.7 1,535.2 445.4 787.2 302.7

2010 Q4 5,996.9 1,778.5 107.4 1,507.5 16.4 1,507.6 27.8 1,051.7 1,535.2 445.4 787.2 302.72011 Q1 (p) 5,941.5 1,766.7 102.6 1,514.7 19.8 1,472.5 28.3 1,036.8 1,545.5 448.6 796.3 300.6

2010 Nov. 6,189.3 1,820.0 115.7 1,593.3 17.1 1,526.5 27.5 1,089.2 1,554.2 446.4 804.6 303.2 Dec. 5,996.9 1,778.5 107.4 1,507.5 16.4 1,507.6 27.8 1,051.7 1,535.2 445.4 787.2 302.7

2011 Jan. 6,028.5 1,787.1 106.8 1,524.9 17.7 1,496.4 26.4 1,069.2 1,552.5 448.2 802.7 301.6 Feb. 6,033.7 1,794.4 103.4 1,528.9 18.6 1,502.9 27.5 1,058.0 1,541.7 449.3 794.1 298.2 Mar. (p) 5,941.5 1,766.7 102.6 1,514.7 19.8 1,472.5 28.3 1,036.8 1,545.5 448.6 796.3 300.6

Transactions

2009 354.4 83.5 16.6 230.6 -3.2 103.3 -12.0 -64.5 43.2 29.1 11.8 2.32010 -262.4 -164.5 -7.3 42.3 -2.1 14.5 -14.6 -130.8 57.0 29.8 6.4 20.8

2010 Q4 -200.8 -69.8 0.5 -28.5 -1.4 -2.6 -2.9 -96.1 21.1 3.9 11.6 5.62011 Q1 (p) -9.4 -5.9 1.1 8.0 4.4 -33.4 2.3 14.1 6.7 2.8 7.2 -3.3

2010 Nov. -22.4 18.4 2.3 -47.4 1.7 35.5 -1.0 -31.9 27.6 4.2 17.0 6.4 Dec. -167.8 -39.4 -5.7 -85.3 -0.3 -15.4 0.8 -22.4 -13.5 -1.3 -10.9 -1.2

2011 Jan. 45.6 10.0 1.5 16.3 1.6 -10.8 -0.8 27.8 14.0 2.3 13.7 -2.0 Feb. 10.7 8.0 -2.8 5.4 1.0 6.3 1.6 -8.8 -12.6 0.6 -9.3 -4.0 Mar. (p) -65.6 -23.9 2.4 -13.7 1.8 -28.8 1.5 -4.9 5.4 -0.1 2.8 2.7

Growth rates

2009 6.0 4.4 17.6 18.7 -15.8 7.6 -23.2 -5.3 2.9 7.0 1.5 0.82010 -4.2 -8.4 -5.8 2.8 -11.2 0.9 -35.0 -11.1 3.8 6.8 0.8 7.5

2010 Q4 -4.2 -8.4 -5.8 2.8 -11.2 0.9 -35.0 -11.1 3.8 6.8 0.8 7.52011 Q1 (p) -5.0 -9.0 -4.5 -1.0 14.4 -0.1 -25.7 -9.5 3.5 4.4 3.4 2.6

2010 Nov. -2.5 -7.4 2.0 6.2 -9.4 2.9 -42.3 -10.9 4.3 6.5 1.4 9.3 Dec. -4.2 -8.4 -5.8 2.8 -11.2 0.9 -35.0 -11.1 3.8 6.8 0.8 7.5

2011 Jan. -3.7 -8.1 -3.4 3.3 -15.5 0.7 -37.7 -9.1 3.4 4.4 1.9 6.3 Feb. -3.6 -7.0 -3.6 1.8 6.6 0.9 -31.7 -9.9 3.6 5.5 2.3 4.5 Mar. (p) -5.0 -9.0 -4.5 -1.0 14.4 -0.1 -25.7 -9.5 3.5 4.4 3.4 2.6

C14 MFI holdings of securities 2)

(annual growth rates)

-10

-5

0

5

10

15

20

25

30

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010-10

-5

0

5

10

15

20

25

30

securities other than sharesshares and other equity

Source: ECB.1) MFI sector excluding the Eurosystem; sectoral classification is based on the ESA 95.2) Data refer to the changing composition of the euro area. For further information, see the General Notes.

EURO AREASTATISTICS

Money,banking

andinvestment

funds

2.7 Revaluation of selected MFI balance sheet items 1), 2) (EUR billions)

S 21ECB

Monthly BulletinMay 2011

1. Write-offs/write-downs of loans to households 3)

Consumer credit Lending for house purchase Other lending

Total Up to Over 1 Over Total Up to Over 1 Over Total Up to Over 1 Over1 year and up to 5 years 1 year and up to 5 years 1 year and up to 5 years

5 years 5 years 5 years

1 2 3 4 5 6 7 8 9 10 11 12

2008 -4.6 -1.1 -1.5 -1.9 -2.7 0.0 -0.2 -2.5 -6.7 -1.2 -2.3 -3.22009 -7.5 -1.8 -2.3 -3.4 -4.0 -0.1 -0.2 -3.7 -7.4 -1.6 -1.3 -4.52010 -7.3 -2.7 -1.9 -2.6 -4.7 -0.2 -0.2 -4.3 -8.6 -1.1 -1.6 -6.0

2010 Q3 -1.9 -0.5 -0.5 -0.9 -0.7 0.0 0.0 -0.7 -1.2 -0.1 -0.2 -0.8 Q4 -1.8 -0.7 -0.4 -0.7 -1.8 -0.1 -0.1 -1.6 -3.2 -0.1 -0.6 -2.52011 Q1 (p) -1.3 -0.6 -0.2 -0.5 -0.8 0.0 0.0 -0.8 -1.5 -0.1 -0.2 -1.1

2011 Jan. -0.4 -0.3 0.0 -0.1 -0.3 0.0 0.0 -0.3 -0.7 -0.1 -0.1 -0.5 Feb. -0.4 -0.2 -0.1 -0.2 -0.2 0.0 0.0 -0.2 -0.5 0.0 -0.1 -0.4 Mar. (p) -0.6 -0.2 -0.2 -0.2 -0.4 0.0 0.0 -0.3 -0.4 0.0 -0.1 -0.3

2. Write-offs/write-downs of loans to non-financial corporations and non-euro area residents

Non-financial corporations Non-euro area residents

Total Up to Over 1 Over Total Up to Over 11 year and up to 5 years 1 year year

5 years

1 2 3 4 5 6 7

2008 -17.8 -4.1 -9.1 -4.6 -6.6 -3.4 -3.22009 -35.4 -12.7 -12.5 -10.2 -6.9 -2.6 -4.22010 -60.2 -24.6 -20.4 -15.2 -3.7 -1.1 -2.6

2010 Q3 -10.3 -4.0 -2.8 -3.6 -0.4 -0.3 -0.2 Q4 -20.6 -8.0 -7.3 -5.3 -1.2 0.1 -1.32011 Q1 (p) -6.3 -1.9 -1.9 -2.5 -0.3 0.1 -0.4

2011 Jan. -1.6 -0.7 -0.4 -0.5 -0.2 0.0 -0.2 Feb. -1.0 -0.3 -0.3 -0.4 0.0 0.0 0.0 Mar. (p) -3.6 -1.0 -1.1 -1.5 -0.1 0.1 -0.2

3. Revaluation of securities held by MFIs

Securities other than shares Shares and other equity

Total MFIs General Other euro Non-euro area Total MFIs Non-MFIs Non-euro area

government area residents residents residents

Euro Non-euro Euro Non-euro Euro Non-euro

1 2 3 4 5 6 7 8 9 10 11 12

2008 -60.4 -12.0 0.0 4.5 0.0 -19.0 -2.2 -31.7 -63.6 -9.2 -46.2 -8.22009 4.4 8.2 0.2 -0.8 -0.1 -0.8 0.8 -3.0 1.0 -5.9 3.4 3.52010 -9.2 -1.8 0.0 -13.1 0.8 -0.8 -1.2 6.9 -19.8 -6.8 -9.4 -3.6

2010 Q3 17.9 3.7 -0.2 6.0 0.3 5.5 -1.4 3.9 1.7 0.1 4.1 -2.5 Q4 -28.7 -6.1 -0.5 -14.9 -0.1 -4.4 0.0 -2.8 -7.4 -2.6 -6.0 1.22011 Q1 (p) -6.5 -2.1 -0.3 -1.2 0.0 -1.4 -0.5 -1.0 2.7 0.5 2.1 0.1

2011 Jan. -2.4 -1.5 -0.3 0.4 0.0 -0.4 0.0 -0.5 2.3 0.8 1.7 -0.3 Feb. 0.0 0.0 0.0 -0.9 0.0 1.7 -0.4 -0.3 1.8 0.2 1.0 0.6 Mar. (p) -4.1 -0.6 0.0 -0.7 0.0 -2.6 0.0 -0.2 -1.4 -0.6 -0.6 -0.3

Source: ECB.1) MFI sector excluding the Eurosystem; sectoral classification is based on the ESA 95.2) Data refer to the changing composition of the euro area. For further information, see the General Notes.3) Including non-profit institutions serving households.

2.8 Currency breakdown of selected MFI balance sheet items 1), 2) (percentages of total; outstanding amounts in EUR billions; end of period)

S 22ECBMonthly BulletinMay 2011

1. Deposits

By euro area residents

MFIs 3) Non-MFIs

All Euro 4) Non-euro currencies All Euro 4) Non-euro currencies

currencies currencies (outstanding Total (outstanding Total

amount) amount)USD JPY CHF GBP USD JPY CHF GBP

1 2 3 4 5 6 7 8 9 10 11 12 13 14

2008 6,852.0 89.7 10.3 7.3 0.4 1.3 0.8 9,890.2 96.9 3.1 1.9 0.5 0.1 0.42009 6,282.0 92.9 7.1 4.4 0.3 1.2 0.7 10,188.9 97.0 3.0 1.9 0.2 0.1 0.4

2010 Q1 6,222.1 93.0 7.0 4.1 0.3 1.2 0.8 10,201.5 97.0 3.0 2.0 0.2 0.1 0.4 Q2 6,544.4 92.4 7.6 4.5 0.3 1.3 0.9 10,468.0 97.0 3.0 2.0 0.2 0.1 0.4 Q3 6,096.7 92.5 7.5 4.5 0.3 1.2 0.8 10,520.7 97.1 2.9 1.9 0.2 0.1 0.4 Q4 (p) 5,775.4 92.9 7.1 4.1 0.3 1.3 0.8 10,728.6 97.1 2.9 1.9 0.2 0.1 0.4

By non-euro area residents

2008 2,816.2 48.3 51.7 33.4 2.8 2.6 10.2 897.1 54.9 45.1 28.7 1.4 1.9 9.42009 2,532.7 49.2 50.8 34.2 1.8 2.2 9.6 836.0 53.5 46.5 31.4 1.1 1.7 7.5

2010 Q1 2,639.0 50.1 49.9 32.9 2.2 2.2 9.4 904.7 54.9 45.1 31.9 1.1 1.3 6.1 Q2 2,693.4 52.9 47.1 30.8 2.1 1.6 9.5 1,007.0 55.1 44.9 31.8 1.1 1.4 6.5 Q3 2,597.1 51.4 48.6 32.4 2.2 1.6 9.2 983.4 57.1 42.9 30.4 1.2 1.3 5.8 Q4 (p) 2,490.7 52.1 47.9 31.8 2.2 1.8 8.6 996.9 58.6 41.4 29.5 1.2 1.4 5.1

2. Debt securities issued by euro area MFIs

All Euro 4) Non-euro currencies

currencies (outstanding Total

amount)USD JPY CHF GBP

1 2 3 4 5 6 7

2008 5,101.8 83.3 16.7 8.4 2.0 1.9 2.52009 5,168.3 83.3 16.7 8.8 1.6 1.9 2.5

2010 Q1 5,284.2 82.5 17.5 9.5 1.6 1.8 2.5 Q2 5,244.3 81.6 18.4 10.0 1.8 2.0 2.5 Q3 5,143.2 82.3 17.7 9.4 1.7 2.0 2.4 Q4 (p) 5,082.1 81.6 18.4 9.7 1.8 2.1 2.5

Source: ECB.1) MFI sector excluding the Eurosystem; sectoral classification is based on the ESA 95.2) Data refer to the changing composition of the euro area. For further information, see the General Notes.3) For non-euro area residents, the term ‘‘MFIs’’ refers to institutions similar to euro area MFIs.4) Including items expressed in the national denominations of the euro.

EURO AREASTATISTICS

Money,banking

andinvestment

funds

2.8 Currency breakdown of selected MFI balance sheet items 1), 2) (percentages of total; outstanding amounts in EUR billions; end of period)

S 23ECB

Monthly BulletinMay 2011

3. Loans

To euro area residents

MFIs 3) Non-MFIs

All Euro 4) Non-euro currencies All Euro 4) Non-euro currencies

currencies currencies (outstanding Total (outstanding Total

amount) amount)USD JPY CHF GBP USD JPY CHF GBP

1 2 3 4 5 6 7 8 9 10 11 12 13 14

2008 6,307.7 - - - - - - 11,748.1 95.9 4.1 2.1 0.3 1.1 0.42009 5,917.5 - - - - - - 11,784.9 96.2 3.8 1.9 0.2 1.0 0.4

2010 Q1 5,916.7 - - - - - - 11,832.5 96.1 3.9 2.0 0.2 1.0 0.4 Q2 6,208.2 - - - - - - 12,060.1 95.8 4.2 2.2 0.3 1.1 0.4 Q3 5,841.1 - - - - - - 12,056.1 96.0 4.0 2.0 0.2 1.1 0.4 Q4 (p) 5,516.4 - - - - - - 12,247.0 96.0 4.0 2.1 0.2 1.1 0.4

To non-euro area residents

2008 2,278.8 45.8 54.2 31.8 3.0 2.6 11.3 963.6 40.4 59.6 42.0 1.4 4.3 7.52009 1,914.9 45.8 54.2 29.4 2.7 2.9 12.6 906.8 40.0 60.0 42.1 1.2 3.7 8.0

2010 Q1 1,985.1 46.6 53.4 29.8 2.6 3.0 11.2 964.8 40.2 59.8 42.5 1.3 3.4 7.5 Q2 2,074.4 46.5 53.5 29.9 2.7 3.0 11.9 1,001.6 39.2 60.8 43.4 1.4 3.5 7.7 Q3 1,995.7 45.9 54.1 29.6 3.3 3.0 12.0 956.0 40.6 59.4 41.7 1.4 3.6 7.3 Q4 (p) 2,009.3 44.8 55.2 30.7 2.9 3.2 11.6 952.2 39.9 60.1 42.8 1.4 3.7 6.7

4. Holdings of securities other than shares

Issued by euro area residents

Issued by MFIs 3) Issued by non-MFIs

All Euro 4) Non-euro currencies All Euro 4) Non-euro currencies

currencies currencies (outstanding Total (outstanding Total

amount) amount)USD JPY CHF GBP USD JPY CHF GBP

1 2 3 4 5 6 7 8 9 10 11 12 13 14

2008 1,976.3 95.3 4.7 2.6 0.4 0.2 1.2 2,651.8 97.3 2.7 1.7 0.3 0.1 0.42009 2,080.2 94.8 5.2 3.1 0.2 0.3 1.4 2,980.4 98.1 1.9 1.2 0.2 0.1 0.3

2010 Q1 2,092.7 94.6 5.4 3.2 0.2 0.3 1.4 3,033.9 98.1 1.9 1.2 0.2 0.1 0.3 Q2 2,024.8 94.2 5.8 3.5 0.2 0.3 1.5 3,081.7 98.5 1.5 0.8 0.2 0.1 0.4 Q3 1,968.4 94.6 5.4 3.0 0.2 0.3 1.6 3,114.3 98.5 1.5 0.9 0.2 0.1 0.4 Q4 (p) 1,885.9 94.3 5.7 3.3 0.1 0.3 1.7 3,059.4 98.6 1.4 0.8 0.1 0.1 0.4

Issued by non-euro area residents

2008 580.3 54.1 45.9 28.6 0.9 0.5 13.3 646.2 39.0 61.0 37.1 6.4 0.8 11.12009 546.6 55.8 44.2 26.3 0.4 0.5 14.8 600.5 34.9 65.1 38.5 4.2 0.9 15.2

2010 Q1 561.8 55.3 44.7 28.0 0.4 0.5 14.8 611.4 32.9 67.1 39.9 4.2 0.9 14.9 Q2 559.0 53.4 46.6 27.4 0.4 0.9 15.2 640.8 28.8 71.2 43.8 4.5 0.6 15.1 Q3 535.8 52.2 47.8 27.7 0.4 0.9 16.1 606.0 29.8 70.2 42.5 4.6 0.6 15.0 Q4 (p) 535.9 51.0 49.0 26.1 0.3 0.5 17.1 515.7 32.4 67.6 41.9 3.8 0.9 13.3

Source: ECB.1) MFI sector excluding the Eurosystem; sectoral classification is based on the ESA 95.2) Data refer to the changing composition of the euro area. For further information, see the General Notes.3) For non-euro area residents, the term ‘‘MFIs’’ refers to institutions similar to euro area MFIs.4) Including items expressed in the national denominations of the euro.

2.9 Aggregated balance sheet of euro area investment funds 1) (EUR billions; outstanding amounts at end of period; transactions during period)

S 24ECBMonthly BulletinMay 2011

1. Assets

Outstanding amounts

Total Deposits and Securities other Shares and other Investment fund/ Non-financial Other assetsloan claims than shares equity (excl. money market fund assets (incl. financial

investment fund/ shares derivatives)money market fund

shares)1 2 3 4 5 6 7

2010 Aug. 6,039.7 386.6 2,360.9 1,741.4 807.7 249.9 493.2 Sep. 6,097.5 374.9 2,342.8 1,793.1 823.8 246.3 516.6 Oct. 6,162.1 375.5 2,356.3 1,842.6 835.2 247.7 504.7 Nov. 6,191.1 373.7 2,366.5 1,882.2 844.9 249.0 474.8 Dec. 6,254.4 365.7 2,363.5 1,982.6 863.9 213.8 464.9

2011 Jan. 6,255.2 377.7 2,342.9 1,976.5 861.3 213.2 483.5 Feb. (p) 6,313.4 383.0 2,356.4 2,005.4 866.5 213.7 488.3

Transactions

2010 Q2 15.4 21.5 12.6 -35.0 8.0 1.8 6.5 Q3 141.3 -14.0 65.1 15.0 17.7 -0.2 57.8 Q4 6.8 -3.7 45.9 48.9 15.3 -2.8 -96.7

2. Liabilities

Outstanding amounts

Total Loans and Investment fund shares issued Other

deposits liabilitiesreceived Total Held by euro area residents Held by (incl. financial

non-euro area derivatives)Investment residents

funds1 2 3 4 5 6 7

2010 Aug. 6,039.7 128.7 5,466.8 4,305.9 602.0 1,160.9 444.2 Sep. 6,097.5 126.4 5,514.9 4,346.3 624.3 1,168.6 456.1 Oct. 6,162.1 122.2 5,592.4 4,396.9 636.7 1,195.5 447.5 Nov. 6,191.1 119.6 5,640.8 4,396.6 640.3 1,244.2 430.7 Dec. 6,254.4 111.5 5,745.7 4,467.1 657.2 1,278.6 397.2

2011 Jan. 6,255.2 111.9 5,734.7 4,461.8 658.1 1,272.9 408.6 Feb. (p) 6,313.4 113.0 5,788.8 4,502.2 661.8 1,286.6 411.6

Transactions

2010 Q2 15.4 8.1 37.6 9.8 -0.3 27.7 -30.3 Q3 141.3 -6.1 80.9 49.7 21.2 31.3 66.5 Q4 6.8 -4.1 79.3 43.4 15.5 35.9 -68.5

3. Investment fund shares issued broken down by investment policy and type of fund

Outstanding amounts

Total Funds by investment policy Funds by type Memo item:

Money marketBond Equity Mixed Real estate Hedge Other Open-end Closed-end fundsfunds funds funds funds funds funds funds funds

1 2 3 4 5 6 7 8 9 10

2010 July 5,396.6 1,766.4 1,521.3 1,308.1 259.0 104.9 436.8 5,316.2 80.3 1,143.6 Aug. 5,466.8 1,821.5 1,510.5 1,333.1 259.6 105.3 436.8 5,386.4 80.4 1,180.6 Sep. 5,514.9 1,813.2 1,554.7 1,345.5 259.9 101.7 440.0 5,434.6 80.4 1,137.7 Oct. 5,592.4 1,825.1 1,600.9 1,362.4 260.8 102.1 441.1 5,512.4 80.0 1,125.6 Nov. 5,640.8 1,828.6 1,641.2 1,366.6 258.9 106.4 439.1 5,560.4 80.4 1,152.5 Dec. 5,745.7 1,811.9 1,717.3 1,397.1 263.2 108.2 448.0 5,663.5 82.2 1,106.5

2011 Jan. 5,734.7 1,801.4 1,710.5 1,399.8 261.9 107.8 453.3 5,650.4 84.2 1,090.4 Feb. (p) 5,788.8 1,812.7 1,732.5 1,415.3 262.9 108.5 457.0 5,704.5 84.3 1,097.7

Transactions

2010 Aug. 32.5 19.4 3.0 10.8 0.0 -1.3 0.7 32.8 -0.3 28.1 Sep. 19.9 12.9 0.7 7.7 0.5 -1.2 -0.8 19.6 0.3 -17.8 Oct. 32.3 12.3 16.5 3.6 0.6 0.1 -0.8 33.1 -0.8 -6.5 Nov. 17.7 5.9 8.7 5.4 0.0 -0.6 -1.8 17.8 -0.2 6.0 Dec. 29.4 -4.8 13.0 13.4 2.7 2.3 2.8 28.1 1.3 -33.9

2011 Jan. 16.6 -0.6 9.1 6.2 0.4 0.2 1.4 16.2 0.5 -9.5 Feb. (p) 18.5 10.2 3.3 4.7 -0.1 0.0 0.4 18.7 -0.2 8.6

Source: ECB.1) Other than money market funds (which are shown as a memo item in column 10 in Table 3 of this section). For further details, see the General Notes.

EURO AREASTATISTICS

Money,banking

andinvestment

funds

2.10 Securities held by investment funds 1) broken down by issuer of securities (EUR billions; outstanding amounts at end of period; transactions during period)

S 25ECB

Monthly BulletinMay 2011

1. Securities other than shares

Outstanding amounts

Total Euro area Rest of the world

Total MFIs General Other Insurance Non-financial EU United Japangovernment financial corporations corporations Member States States

intermediaries and pension outside thefunds euro area

1 2 3 4 5 6 7 8 9 10 11

2010 Q1 2,218.3 1,456.6 391.7 704.1 199.0 5.9 155.9 761.7 217.7 291.4 15.4 Q2 2,273.1 1,436.7 379.9 706.7 192.4 6.0 151.6 836.4 229.0 326.0 16.0 Q3 2,342.8 1,469.6 384.7 721.0 193.5 6.4 164.0 873.2 242.4 330.7 16.3 Q4 (p) 2,363.5 1,428.6 375.1 690.6 192.5 6.1 164.3 934.9 246.8 365.3 16.1

Transactions

2010 Q2 12.6 -23.0 -11.8 -3.3 -3.5 0.5 -4.9 35.6 7.4 12.8 -1.4 Q3 65.1 16.4 2.9 2.9 2.0 0.0 8.7 48.6 9.7 20.3 0.4 Q4 (p) 45.9 -7.9 -3.1 -8.8 0.3 -0.2 3.9 53.7 6.2 29.6 -2.0

2. Shares and other equity (other than investment fund and money market fund shares)

Outstanding amounts

Total Euro area Rest of the world

Total MFIs General Other Insurance Non-financial EU United Japangovernment financial corporations corporations Member States States

intermediaries and pension outside thefunds euro area

1 2 3 4 5 6 7 8 9 10 11

2010 Q1 1,819.8 752.8 95.0 - 36.6 28.4 592.9 1,066.9 148.2 329.5 75.5 Q2 1,714.0 671.2 74.0 - 34.0 23.9 539.2 1,042.8 140.8 316.0 78.1 Q3 1,793.1 712.4 79.7 - 37.4 24.2 571.0 1,080.7 153.9 314.5 67.2 Q4 (p) 1,982.6 747.3 76.7 - 39.7 25.1 605.7 1,235.3 171.5 354.3 83.7

Transactions

2010 Q2 -35.0 -25.4 -8.0 - -1.0 -1.3 -15.2 -9.6 -1.9 -6.4 3.5 Q3 15.0 9.7 -0.8 - 2.1 0.3 8.1 5.3 2.0 0.4 -8.5 Q4 (p) 48.9 4.0 4.3 - 1.9 -0.6 -1.6 45.0 5.1 3.3 6.6

3. Investment fund/money market fund shares

Outstanding amounts

Total Euro area Rest of the world

Total MFIs 2) General Other Insurance Non-financial EU United Japangovernment financial corporations corporations Member States States

intermediaries 2) and pension outside thefunds euro area

1 2 3 4 5 6 7 8 9 10 11

2010 Q1 782.4 661.8 71.2 - 590.6 - - 120.5 18.3 34.7 0.4 Q2 792.6 662.3 77.0 - 585.2 - - 130.4 19.3 36.4 0.4 Q3 823.8 701.4 77.0 - 624.3 - - 122.5 20.7 34.1 0.4 Q4 (p) 863.9 732.6 75.3 - 657.2 - - 131.3 23.8 38.0 0.6

Transactions

2010 Q2 8.0 4.6 4.9 - -0.3 - - 3.3 1.0 -0.4 -0.1 Q3 17.7 22.3 1.1 - 21.2 - - -4.6 1.0 -0.8 0.0 Q4 (p) 15.3 13.4 -2.1 - 15.5 - - 1.9 0.5 1.4 0.1

Source: ECB.1) Other than money market funds. For further details, see the General Notes.2) Investment fund shares (other than money market fund shares) are issued by other financial intermediaries. Money market fund shares are issued by MFIs.

3 EURO AREA ACCOUNTS

3.1 Integrated economic and financial accounts by institutional sector (EUR billions)

S 26ECBMonthly BulletinMay 2011

Uses Euro Households Non-financial Financial General Rest ofarea corporations corporations government the world

2010 Q4

External account

Exports of goods and services 557 Trade balance 1) -20

Generation of income account

Gross value added (basic prices) Taxes less subsidies on products Gross domestic product (market prices) Compensation of employees 1,218 124 766 62 266 Other taxes less subsidies on production 35 8 17 5 5 Consumption of fixed capital 356 98 199 12 48 Net operating surplus and mixed income 1) 532 272 238 25 -3

Allocation of primary income account

Net operating surplus and mixed income Compensation of employees 6 Taxes less subsidies on production Property income 659 36 262 300 61 96 Interest 357 33 61 201 61 48 Other property income 303 3 200 99 0 48 Net national income 1) 2,043 1,677 78 34 255

Secondary distribution of income account

Net national income Current taxes on income, wealth, etc. 304 246 50 8 0 1 Social contributions 461 461 1 Social benefits other than social transfers in kind 481 2 17 34 429 1 Other current transfers 206 80 28 48 50 9 Net non-life insurance premiums 46 33 11 1 1 1 Non-life insurance claims 46 46 1 Other 113 46 16 1 50 7 Net disposable income 1) 2,014 1,468 14 41 492

Use of income account

Net disposable income Final consumption expenditure 1,916 1,365 551 Individual consumption expenditure 1,696 1,365 331 Collective consumption expenditure 220 220 Adjustment for the change in the net equity of households in pension fund reserves 16 0 1 15 0 0 Net saving/current external account 1) 99 118 13 27 -59 -4

Capital account

Net saving/current external account Gross capital formation 451 141 223 13 74 Gross fixed capital formation 470 141 242 13 74 Changes in inventories and acquisitions less disposals of valuables -18 0 -19 0 0 Consumption of fixed capital Acquisitions less disposals of non-produced non-financial assets 1 -2 3 0 0 -1 Capital transfers 73 10 5 7 51 7 Capital taxes 6 6 0 0 0 Other capital transfers 67 4 5 6 51 7 Net lending (+)/net borrowing (-) (from capital account) 1) 7 83 10 33 -119 -7 Statistical discrepancy 0 20 -20 0 0 0

Sources: ECB and Eurostat.1) For details of the calculation of the balancing items, see the Technical Notes.

EURO AREASTATISTICS

Euro areaaccounts

3.1 Integrated economic and financial accounts by institutional sector (cont'd) (EUR billions)

S 27ECB

Monthly BulletinMay 2011

Resources Euro Households Non-financial Financial General Rest ofarea corporations corporations government the world

2010 Q4

External account

Imports of goods and services 537 Trade balance

Generation of income account

Gross value added (basic prices) 2,141 502 1,219 104 316 Taxes less subsidies on products 246 Gross domestic product (market prices)2) 2,387 Compensation of employees Other taxes less subsidies on production Consumption of fixed capital Net operating surplus and mixed income

Allocation of primary income account

Net operating surplus and mixed income 532 272 238 25 -3 Compensation of employees 1,219 1,219 4 Taxes less subsidies on production 296 296 -15 Property income 656 221 102 308 24 100 Interest 343 54 31 248 10 61 Other property income 312 167 71 60 14 39 Net national income

Secondary distribution of income account

Net national income 2,043 1,677 78 34 255 Current taxes on income, wealth, etc. 305 305 1 Social contributions 461 1 18 51 391 1 Social benefits other than social transfers in kind 479 479 3 Other current transfers 179 99 12 48 20 36 Net non-life insurance premiums 46 46 1 Non-life insurance claims 46 36 9 1 0 1 Other 87 64 3 0 20 34 Net disposable income

Use of income account

Net disposable income 2,014 1,468 14 41 492 Final consumption expenditure Individual consumption expenditure Collective consumption expenditure Adjustment for the change in the net equity of households in pension fund reserves 16 16 0 Net saving/current external account

Capital account

Net saving/current external account 99 118 13 27 -59 -4 Gross capital formation Gross fixed capital formation Changes in inventories and acquisitions less disposals of valuables Consumption of fixed capital 356 98 199 12 48 Acquisitions less disposals of non-produced non-financial assets Capital transfers 77 15 30 13 18 3 Capital taxes 6 6 0 Other capital transfers 71 15 30 13 12 3 Net lending (+)/net borrowing (-) (from capital account) Statistical discrepancy

Sources: ECB and Eurostat.2) Gross domestic product is equal to the gross value added of all domestic sectors plus net taxes (i.e. taxes less subsidies) on products.

3.1 Integrated economic and financial accounts by institutional sector (cont'd) (EUR billions)

S 28ECBMonthly BulletinMay 2011

Assets Euro Households Non-financial MFIs Other Insurance General Rest ofarea corporations financial corporations govern- the world

inter- and pension ment2010 Q4 mediaries funds

Opening balance sheet, financial assets

Total financial assets 18,609 17,015 32,830 14,663 6,712 3,541 16,253 Monetary gold and special drawing rights (SDRs) 386 Currency and deposits 6,508 1,744 9,438 2,395 851 688 3,841 Short-term debt securities 46 120 617 301 49 32 653 Long-term debt securities 1,442 277 6,369 2,453 2,546 349 3,554 Loans 69 3,266 13,075 3,642 480 482 1,808 of which: Long-term 52 1,747 10,160 2,589 351 404 . Shares and other equity 4,362 7,533 1,902 5,641 2,353 1,341 5,712 Quoted shares 769 1,454 381 1,897 437 267 . Unquoted shares and other equity 2,178 5,712 1,194 2,943 423 873 . Mutual fund shares 1,415 367 327 801 1,493 202 . Insurance technical reserves 5,669 178 3 0 280 4 199 Other accounts receivable and financial derivatives 514 3,898 1,040 231 153 645 487 Net financial worth

Financial account, transactions in financial assets

Total transactions in financial assets 147 154 -40 55 11 235 63 Monetary gold and SDRs 0 0 Currency and deposits 115 50 -3 5 -18 13 -84 Short-term debt securities -12 -41 -36 -6 -5 19 -21 Long-term debt securities -4 57 -148 43 24 149 29 Loans 1 41 177 19 16 39 59 of which: Long-term 1 13 112 -30 2 36 . Shares and other equity -7 40 32 6 -4 -3 69 Quoted shares 9 16 19 36 1 -7 . Unquoted shares and other equity -1 26 15 -24 5 4 . Mutual fund shares -16 -2 -2 -6 -10 0 . Insurance technical reserves 50 -2 0 0 -2 0 2 Other accounts receivable and financial derivatives 3 10 -62 -12 1 19 9 Changes in net financial worth due to transactions

Other changes account, financial assets

Total other changes in financial assets 108 128 -258 187 -53 1 61 Monetary gold and SDRs 35 Currency and deposits 1 1 -216 31 1 0 11 Short-term debt securities -1 1 0 3 0 0 -2 Long-term debt securities -65 -12 -46 -42 -81 -5 -101 Loans 0 8 15 5 0 0 37 of which: Long-term 0 5 3 5 0 0 . Shares and other equity 180 284 -6 204 28 12 132 Quoted shares 33 127 33 149 5 3 . Unquoted shares and other equity 106 165 -24 21 7 2 . Mutual fund shares 41 -8 -14 34 16 8 . Insurance technical reserves -12 0 0 0 -1 0 4 Other accounts receivable and financial derivatives 6 -153 -40 -12 0 -6 -20 Other changes in net financial worth

Closing balance sheet, financial assets

Total financial assets 18,864 17,298 32,532 14,905 6,670 3,777 16,378 Monetary gold and SDRs 420 Currency and deposits 6,624 1,794 9,220 2,430 833 700 3,768 Short-term debt securities 33 79 581 298 44 51 630 Long-term debt securities 1,372 322 6,175 2,453 2,489 493 3,483 Loans 71 3,316 13,267 3,665 496 521 1,903 of which: Long-term 52 1,765 10,276 2,565 354 440 . Shares and other equity 4,535 7,857 1,929 5,851 2,378 1,350 5,913 Quoted shares 811 1,596 433 2,082 443 262 . Unquoted shares and other equity 2,283 5,904 1,185 2,940 435 879 . Mutual fund shares 1,441 357 311 828 1,500 209 . Insurance technical reserves 5,706 175 3 0 277 4 205 Other accounts receivable and financial derivatives 523 3,755 937 207 153 657 475 Net financial worth

Source: ECB.

EURO AREASTATISTICS

Euro areaaccounts

3.1 Integrated economic and financial accounts by institutional sector (cont'd) (EUR billions)

S 29ECB

Monthly BulletinMay 2011

Liabilities Euro Households Non-financial MFIs Other Insurance General Rest ofarea corporations financial corporations govern- the world

inter- and pension ment2010 Q4 mediaries funds

Opening balance sheet, liabilities

Total liabilities 6,588 26,163 32,088 14,129 6,773 8,824 14,673 Monetary gold and special drawing rights (SDRs) Currency and deposits 29 22,519 25 0 262 2,629 Short-term debt securities 77 685 80 0 735 241 Long-term debt securities 819 4,614 2,740 38 5,876 2,903 Loans 5,999 8,612 3,329 280 1,499 3,104 of which: Long-term 5,642 6,020 1,821 103 1,289 . Shares and other equity 7 12,554 2,764 7,736 450 8 5,326 Quoted shares 3,542 487 211 123 0 . Unquoted shares and other equity 7 9,012 1,139 2,195 326 8 . Mutual fund shares 1,138 5,331 . Insurance technical reserves 34 337 62 1 5,897 1 Other accounts payable and financial derivatives 548 3,735 1,443 219 107 444 470 Net financial worth 1) -1,195 12,021 -9,148 743 534 -61 -5,283

Financial account, transactions in liabilities

Total transactions in liabilities 43 164 -77 45 26 355 70 Monetary gold and SDRs Currency and deposits 0 83 1 0 -9 1 Short-term debt securities -6 -55 -3 0 -31 -6 Long-term debt securities 10 -19 9 1 143 7 Loans 45 15 42 -22 220 52 of which: Long-term 41 10 20 1 70 . Shares and other equity 0 75 -16 54 1 0 19 Quoted shares 5 17 1 0 0 . Unquoted shares and other equity 0 70 2 -34 1 0 . Mutual fund shares -34 87 . Insurance technical reserves 0 4 2 0 42 0 Other accounts payable and financial derivatives -2 66 -72 -58 5 31 -2 Changes in net financial worth due to transactions 1) 7 103 -10 38 10 -15 -119 -7

Other changes account, liabilities

Total other changes in liabilities -4 328 -381 230 36 -222 153 Monetary gold and SDRs Currency and deposits 0 -189 0 0 0 17 Short-term debt securities -1 2 0 0 0 0 Long-term debt securities -20 -69 -8 1 -221 -36 Loans 5 -2 35 4 1 21 of which: Long-term 5 -1 34 4 1 . Shares and other equity 0 396 56 164 7 -1 212 Quoted shares 266 -47 7 4 0 . Unquoted shares and other equity 0 129 100 19 3 -1 . Mutual fund shares 3 138 . Insurance technical reserves 0 -3 0 0 -7 0 Other accounts payable and financial derivatives -9 -42 -181 39 30 -2 -60 Other changes in net financial worth 1) 126 112 -200 123 -43 -89 223 -91

Closing balance sheet, liabilities

Total liabilities 6,627 26,655 31,629 14,404 6,835 8,957 14,895 Monetary gold and SDRs Currency and deposits 30 22,413 26 0 253 2,647 Short-term debt securities 70 633 76 0 703 235 Long-term debt securities 809 4,526 2,741 41 5,799 2,873 Loans 6,049 8,625 3,406 263 1,720 3,176 of which: Long-term 5,689 6,029 1,875 108 1,360 . Shares and other equity 7 13,024 2,805 7,954 458 7 5,557 Quoted shares 3,813 457 218 127 0 . Unquoted shares and other equity 7 9,211 1,241 2,180 330 7 . Mutual fund shares 1,107 5,556 . Insurance technical reserves 34 338 64 1 5,932 1 Other accounts payable and financial derivatives 537 3,759 1,190 200 142 473 407 Net financial worth 1) -1,062 12,237 -9,358 903 501 -166 -5,180

Source: ECB.

3.2 Euro area non-financial accounts (EUR billions; four-quarter cumulated flows)

S 30ECBMonthly BulletinMay 2011

Uses 2009 Q1- 2009 Q2- 2009 Q3- 2009 Q4- 2010 Q1-2006 2007 2008 2009 Q4 2010 Q1 2010 Q2 2010 Q3 2010 Q4

Generation of income account

Gross value added (basic prices) Taxes less subsidies on products Gross domestic product (market prices) Compensation of employees 4,075 4,261 4,440 4,424 4,428 4,445 4,460 4,483 Other taxes less subsidies on production 127 136 132 113 109 109 113 115 Consumption of fixed capital 1,253 1,320 1,383 1,399 1,399 1,403 1,409 1,416 Net operating surplus and mixed income 1) 2,191 2,344 2,327 2,124 2,144 2,177 2,196 2,218

Allocation of primary income account

Net operating surplus and mixed income Compensation of employees Taxes less subsidies on production Property income 3,034 3,636 3,882 2,941 2,811 2,748 2,744 2,779 Interest 1,657 2,085 2,325 1,603 1,485 1,424 1,404 1,406 Other property income 1,377 1,551 1,557 1,338 1,326 1,324 1,340 1,373 Net national income 1) 7,329 7,727 7,784 7,527 7,566 7,625 7,685 7,744

Secondary distribution of income account

Net national income Current taxes on income, wealth, etc. 1,028 1,113 1,122 1,013 1,013 1,021 1,027 1,037 Social contributions 1,542 1,598 1,668 1,673 1,678 1,684 1,691 1,703 Social benefits other than social transfers in kind 1,555 1,602 1,672 1,786 1,805 1,816 1,824 1,833 Other current transfers 723 753 787 786 790 788 791 785 Net non-life insurance premiums 180 184 188 183 183 181 180 180 Non-life insurance claims 180 184 189 183 183 181 181 180 Other 363 385 410 419 424 425 429 425 Net disposable income 1) 7,237 7,633 7,679 7,418 7,452 7,511 7,567 7,628

Use of income account

Net disposable income Final consumption expenditure 6,646 6,910 7,167 7,178 7,213 7,253 7,301 7,348 Individual consumption expenditure 5,956 6,197 6,419 6,395 6,428 6,466 6,513 6,559 Collective consumption expenditure 689 712 748 783 785 787 788 788 Adjustment for the change in the net equity of households in pension fund reserves 64 65 71 66 65 63 62 61 Net saving 1) 592 724 513 240 239 258 266 280

Capital account

Net saving Gross capital formation 1,879 2,033 2,045 1,712 1,691 1,727 1,752 1,777 Gross fixed capital formation 1,857 1,991 2,018 1,782 1,759 1,765 1,774 1,787 Changes in inventories and acquisitions less disposals of valuables 22 42 27 -70 -68 -38 -22 -10 Consumption of fixed capital Acquisitions less disposals of non-produced non-financial assets 0 -1 0 1 2 1 1 1 Capital transfers 170 153 152 185 194 188 201 211 Capital taxes 23 24 24 34 34 30 30 25 Other capital transfers 148 128 128 151 159 158 172 186 Net lending (+)/net borrowing (-) (from capital account) 1) -20 27 -140 -66 -44 -59 -70 -71

Sources: ECB and Eurostat.1) For details of the calculation of the balancing items, see the Technical Notes.

EURO AREASTATISTICS

Euro areaaccounts

3.2 Euro area non-financial accounts (cont'd) (EUR billions; four-quarter cumulated flows)

S 31ECB

Monthly BulletinMay 2011

Resources 2009 Q1- 2009 Q2- 2009 Q3- 2009 Q4- 2010 Q1-2006 2007 2008 2009 Q4 2010 Q1 2010 Q2 2010 Q3 2010 Q4

Generation of income account

Gross value added (basic prices) 7,647 8,061 8,282 8,060 8,080 8,132 8,178 8,232 Taxes less subsidies on products 915 961 947 892 894 910 930 938 Gross domestic product (market prices)2) 8,562 9,022 9,228 8,952 8,975 9,042 9,107 9,170 Compensation of employees Other taxes less subsidies on production Consumption of fixed capital Net operating surplus and mixed income

Allocation of primary income account

Net operating surplus and mixed income 2,191 2,344 2,327 2,124 2,144 2,177 2,196 2,218 Compensation of employees 4,083 4,269 4,446 4,430 4,434 4,451 4,467 4,489 Taxes less subsidies on production 1,055 1,105 1,085 1,022 1,021 1,035 1,058 1,068 Property income 3,035 3,646 3,808 2,892 2,777 2,710 2,710 2,747 Interest 1,628 2,048 2,264 1,544 1,431 1,375 1,355 1,354 Other property income 1,407 1,598 1,544 1,348 1,346 1,335 1,355 1,393 Net national income

Secondary distribution of income account

Net national income 7,329 7,727 7,784 7,527 7,566 7,625 7,685 7,744 Current taxes on income, wealth, etc. 1,033 1,120 1,130 1,019 1,018 1,025 1,032 1,041 Social contributions 1,541 1,597 1,668 1,673 1,678 1,684 1,691 1,703 Social benefits other than social transfers in kind 1,547 1,593 1,664 1,779 1,798 1,808 1,816 1,825 Other current transfers 634 662 683 679 679 678 676 672 Net non-life insurance premiums 180 184 189 183 183 181 181 180 Non-life insurance claims 177 182 186 180 180 178 177 176 Other 278 296 308 316 317 318 318 316 Net disposable income

Use of income account

Net disposable income 7,237 7,633 7,679 7,418 7,452 7,511 7,567 7,628 Final consumption expenditure Individual consumption expenditure Collective consumption expenditure Adjustment for the change in the net equity of households in pension fund reserves 64 65 71 66 65 63 62 62 Net saving

Capital account

Net saving 592 724 513 240 239 258 266 280 Gross capital formation Gross fixed capital formation Changes in inventories and acquisitions less disposals of valuables Consumption of fixed capital 1,253 1,320 1,383 1,399 1,399 1,403 1,409 1,416 Acquisitions less disposals of non-produced non-financial assets Capital transfers 185 168 162 194 204 197 210 222 Capital taxes 23 24 24 34 34 30 30 25 Other capital transfers 162 143 138 160 169 167 181 197 Net lending (+)/net borrowing (-) (from capital account)

Sources: ECB and Eurostat.2) Gross domestic product is equal to the gross value added of all domestic sectors plus net taxes (i.e. taxes less subsidies) on products.

3.3 Households (EUR billions; four-quarter cumulated flows; outstanding amounts at end of period)

S 32ECBMonthly BulletinMay 2011

2009 Q1- 2009 Q2- 2009 Q3- 2009 Q4- 2010 Q1-2006 2007 2008 2009 Q4 2010 Q1 2010 Q2 2010 Q3 2010 Q4

Income, saving and changes in net worth

Compensation of employees (+) 4,083 4,269 4,446 4,430 4,434 4,451 4,467 4,489 Gross operating surplus and mixed income (+) 1,421 1,492 1,536 1,485 1,484 1,487 1,493 1,500 Interest receivable (+) 264 313 347 241 223 215 212 212 Interest payable (-) 167 217 245 146 135 129 127 127 Other property income receivable (+) 748 807 818 735 732 715 725 732 Other property income payable (-) 10 10 10 10 10 10 10 10 Current taxes on income and wealth (-) 794 853 892 861 859 860 864 868 Net social contributions (-) 1,537 1,594 1,663 1,669 1,673 1,679 1,686 1,698 Net social benefits (+) 1,542 1,587 1,658 1,773 1,791 1,802 1,809 1,818 Net current transfers receivable (+) 67 71 72 80 81 81 80 78 = Gross disposable income 5,617 5,866 6,066 6,058 6,068 6,071 6,099 6,127 Final consumption expenditure (-) 4,909 5,104 5,271 5,195 5,221 5,251 5,293 5,336 Changes in net worth in pension funds (+) 64 64 70 66 65 63 62 61 = Gross saving 772 826 866 928 911 883 869 853 Consumption of fixed capital (-) 342 365 381 383 383 385 387 389 Net capital transfers receivable (+) 19 13 2 14 11 9 9 14 Other changes in net worth (+) 2,612 1,416 -2,294 -251 793 853 950 1,027 = Changes in net worth 3,061 1,891 -1,807 309 1,332 1,361 1,441 1,505

Investment, financing and changes in net worth

Net acquisition of non-financial assets (+) 608 645 637 551 541 543 546 550 Consumption of fixed capital (-) 342 365 381 383 383 385 387 389 Main items of financial investment (+) Short-term assets 318 420 452 -17 -97 -83 -33 53 Currency and deposits 285 350 438 120 64 63 89 119 Money market fund shares 1 39 -10 -48 -84 -84 -95 -54 Debt securities 1) 32 31 24 -90 -77 -62 -27 -12 Long-term assets 296 119 31 534 609 564 456 365 Deposits 1 -31 -28 90 118 110 87 60 Debt securities 17 21 30 48 26 36 -7 -11 Shares and other equity 8 -79 -101 169 211 170 131 84 Quoted and unquoted shares and other equity 0 2 23 110 120 99 60 60 Mutual fund shares 8 -82 -124 59 92 71 71 24 Life insurance and pension fund reserves 269 209 130 227 254 247 244 232 Main items of financing (-) Loans 404 373 212 114 128 136 140 137 of which: From euro area MFIs 350 283 82 65 108 136 135 148 Other changes in assets (+) Non-financial assets 2,061 1,426 -898 -758 -111 434 777 842 Financial assets 555 17 -1,469 480 885 430 200 210 Shares and other equity 458 9 -1,245 234 510 169 50 184 Life insurance and pension fund reserves 66 8 -244 177 266 172 114 70 Remaining net flows (+) -30 2 34 15 17 -5 22 10 = Changes in net worth 3,061 1,891 -1,807 309 1,332 1,361 1,441 1,505

Balance sheet

Non-financial assets (+) 25,652 27,358 26,716 26,127 26,164 26,625 26,989 27,130 Financial assets (+) Short-term assets 4,809 5,264 5,800 5,768 5,725 5,767 5,753 5,828 Currency and deposits 4,462 4,852 5,322 5,475 5,447 5,507 5,499 5,598 Money market fund shares 255 293 324 244 233 216 201 190 Debt securities 1) 91 120 154 50 45 44 52 39 Long-term assets 11,926 12,026 10,521 11,549 11,817 11,702 11,942 12,114 Deposits 1,018 953 894 964 991 1,002 1,009 1,025 Debt securities 1,242 1,260 1,314 1,433 1,447 1,444 1,435 1,367 Shares and other equity 5,097 5,028 3,641 4,078 4,174 4,018 4,161 4,345 Quoted and unquoted shares and other equity 3,622 3,680 2,663 2,929 2,984 2,853 2,947 3,094 Mutual fund shares 1,475 1,348 979 1,149 1,190 1,166 1,214 1,251 Life insurance and pension fund reserves 4,569 4,786 4,672 5,075 5,205 5,238 5,337 5,377 Remaining net assets (+) 309 303 315 318 296 310 325 344 Liabilities (-) Loans 5,228 5,591 5,799 5,900 5,907 5,972 5,999 6,049 of which: From euro area MFIs 4,560 4,831 4,906 4,961 4,979 5,132 5,151 5,206 = Net worth 37,470 39,360 37,553 37,862 38,095 38,432 39,010 39,367Sources: ECB and Eurostat.1) Securities issued by MFIs with a maturity of less than two years and securities issued by other sectors with a maturity of less than one year.

EURO AREASTATISTICS

Euro areaaccounts

3.4 Non-financial corporations (EUR billions; four-quarter cumulated flows; outstanding amounts at end of period)

S 33ECB

Monthly BulletinMay 2011

2009 Q1- 2009 Q2- 2009 Q3- 2009 Q4- 2010 Q1-2006 2007 2008 2009 Q4 2010 Q1 2010 Q2 2010 Q3 2010 Q4

Income and saving

Gross value added (basic prices) (+) 4,375 4,647 4,762 4,525 4,537 4,578 4,613 4,658 Compensation of employees (-) 2,589 2,719 2,840 2,787 2,785 2,796 2,808 2,828 Other taxes less subsidies on production (-) 74 80 76 62 58 56 60 60 = Gross operating surplus (+) 1,712 1,848 1,846 1,676 1,695 1,726 1,746 1,770 Consumption of fixed capital (-) 706 740 777 787 786 786 789 792 = Net operating surplus (+) 1,006 1,108 1,069 888 909 940 957 978 Property income receivable (+) 504 596 587 482 477 484 485 495 Interest receivable 172 204 218 147 136 130 127 125 Other property income receivable 332 393 369 334 340 354 358 370 Interest and rents payable (-) 288 354 404 287 268 257 252 253 = Net entrepreneurial income (+) 1,222 1,351 1,253 1,083 1,118 1,167 1,190 1,221 Distributed income (-) 926 988 1,012 908 899 903 913 938 Taxes on income and wealth payable (-) 190 211 197 125 126 134 136 142 Social contributions receivable (+) 75 64 67 69 69 69 69 70 Social benefits payable (-) 61 62 65 67 67 68 68 68 Other net transfers (-) 65 57 61 62 63 64 64 64 = Net saving 54 96 -16 -11 33 68 79 79

Investment, financing and saving

Net acquisition of non-financial assets (+) 307 376 340 77 71 115 137 160 Gross fixed capital formation (+) 989 1,076 1,094 936 927 939 948 963 Consumption of fixed capital (-) 706 740 777 787 786 786 789 792 Net acquisition of other non-financial assets (+) 24 40 22 -72 -69 -38 -23 -11 Main items of financial investment (+) Short-term assets 165 162 62 49 76 33 30 -8 Currency and deposits 146 154 15 90 98 58 49 66 Money market fund shares 2 -19 30 38 4 -21 -27 -32 Debt securities 1) 18 27 17 -79 -27 -4 8 -42 Long-term assets 485 743 660 312 264 346 434 538 Deposits 23 -26 26 0 -10 -9 -7 -12 Debt securities 2 8 -45 11 -13 40 50 85 Shares and other equity 307 458 337 117 99 69 110 189 Other (mainly intercompany loans) 153 303 341 183 188 246 281 277 Remaining net assets (+) 74 158 -15 40 126 38 19 -54 Main items of financing (-) Debt 658 882 708 165 181 178 255 241 of which: Loans from euro area MFIs 444 538 393 -116 -98 -90 -33 -15 of which: Debt securities 36 33 52 84 103 83 69 63 Shares and other equity 246 392 278 240 241 204 207 239 Quoted shares 32 55 6 67 67 47 37 31 Unquoted shares and other equity 214 338 271 173 173 157 169 208 Net capital transfers receivable (-) 72 69 74 81 80 80 79 75 = Net saving 54 96 -16 -11 33 68 79 79

Financial balance sheet

Financial assets Short-term assets 1,665 1,815 1,893 1,971 1,941 1,932 1,946 1,964 Currency and deposits 1,367 1,507 1,537 1,634 1,604 1,610 1,625 1,695 Money market fund shares 183 159 185 206 198 181 181 175 Debt securities 1) 116 150 171 131 140 142 140 94 Long-term assets 9,995 10,941 9,308 10,369 10,698 10,624 10,993 11,403 Deposits 102 105 127 109 111 116 118 99 Debt securities 280 288 251 220 232 259 257 307 Shares and other equity 7,479 8,096 6,126 7,033 7,249 7,026 7,351 7,681 Other (mainly intercompany loans) 2,134 2,451 2,803 3,008 3,105 3,224 3,266 3,316 Remaining net assets 262 306 342 339 382 358 370 202 Liabilities Debt 7,849 8,708 9,441 9,627 9,715 9,801 9,845 9,843 of which: Loans from euro area MFIs 3,947 4,472 4,864 4,700 4,705 4,723 4,703 4,684 of which: Debt securities 644 654 710 821 871 880 896 879 Shares and other equity 13,156 14,336 10,791 12,215 12,445 11,910 12,554 13,024 Quoted shares 4,554 5,056 2,933 3,515 3,590 3,316 3,542 3,813 Unquoted shares and other equity 8,601 9,281 7,858 8,700 8,855 8,595 9,012 9,211

Sources: ECB and Eurostat.1) Securities issued by MFIs with a maturity of less than two years and securities issued by other sectors with a maturity of less than one year.

3.5 Insurance corporations and pension funds (EUR billions; four-quarter cumulated flows; outstanding amounts at end of period)

S 34ECBMonthly BulletinMay 2011

2009 Q1- 2009 Q2- 2009 Q3- 2009 Q4- 2010 Q1-2006 2007 2008 2009 Q4 2010 Q1 2010 Q2 2010 Q3 2010 Q4

Financial account, financial transactions

Main items of financial investment (+) Short-term assets 22 30 91 -39 -46 -10 12 -15 Currency and deposits 12 7 57 -33 -21 2 6 -10 Money market fund shares 3 2 20 9 1 12 11 -6 Debt securities 1) 7 22 14 -15 -26 -24 -6 0 Long-term assets 325 198 93 287 314 271 251 221 Deposits 62 46 -10 19 1 -6 -6 -9 Debt securities 156 87 43 91 105 137 152 149 Loans 1 -14 38 14 15 15 15 29 Quoted shares -7 0 3 -68 -75 -73 3 0 Unquoted shares and other equity 19 17 17 -2 2 4 3 5 Mutual fund shares 95 63 2 234 266 195 84 45 Remaining net assets (+) 15 4 27 8 24 13 14 9 Main items of financing (-) Debt securities 5 4 6 5 3 4 1 0 Loans 50 -2 24 -26 -17 -9 11 7 Shares and other equity 9 3 6 3 2 3 3 3 Insurance technical reserves 297 259 112 252 292 282 274 249 Net equity of households in life insurance and pension fund reserves 277 214 121 240 273 266 260 233 Prepayments of insurance premiums and reserves for outstanding claims 21 45 -9 12 19 16 14 16 = Changes in net financial worth due to transactions 0 -32 63 23 12 -5 -13 -44

Other changes account

Other changes in financial assets (+) Shares and other equity 166 19 -544 197 315 151 92 86 Other net assets -6 -25 51 40 89 112 102 -5 Other changes in liabilities (-) Shares and other equity 25 -4 -170 15 75 31 -6 2 Insurance technical reserves 123 17 -249 183 267 177 118 81 Net equity of households in life insurance and pension fund reserves 64 17 -250 184 269 177 120 84 Prepayments of insurance premiums and reserves for outstanding claims 59 1 1 0 -3 -1 -2 -3 = Other changes in net financial worth 12 -19 -74 39 62 55 82 -2

Financial balance sheet

Financial assets (+) Short-term assets 296 322 416 372 383 397 394 365 Currency and deposits 157 163 224 195 196 206 203 190 Money market fund shares 80 80 98 99 103 108 107 94 Debt securities 1) 59 79 94 78 84 82 84 81 Long-term assets 5,279 5,482 5,034 5,586 5,775 5,764 5,885 5,875 Deposits 598 646 634 651 650 645 648 643 Debt securities 2,054 2,123 2,170 2,321 2,406 2,443 2,511 2,452 Loans 430 416 451 466 474 479 480 496 Quoted shares 709 698 411 424 441 414 437 443 Unquoted shares and other equity 403 444 412 424 426 427 423 435 Mutual fund shares 1,085 1,156 955 1,299 1,378 1,356 1,386 1,406 Remaining net assets (+) 210 204 280 269 291 307 325 288 Liabilities (-) Debt securities 20 23 31 39 40 40 39 41 Loans 256 252 278 251 262 268 280 263 Shares and other equity 600 599 435 453 471 444 450 458 Insurance technical reserves 5,028 5,305 5,168 5,602 5,755 5,798 5,897 5,932 Net equity of households in life insurance and pension fund reserves 4,252 4,482 4,353 4,777 4,912 4,951 5,053 5,093 Prepayments of insurance premiums and reserves for outstanding claims 777 822 814 826 843 847 844 839 = Net financial wealth -119 -170 -181 -119 -79 -83 -61 -166

Source: ECB.1) Securities issued by MFIs with a maturity of less than two years and securities issued by other sectors with a maturity of less than one year.

4FINANCIAL MARKETS

4.1 Securities other than shares by original maturity, residency of the issuer and currency (EUR billions and period growth rates; seasonally adjusted; transactions during the month and end-of-period outstanding amounts; nominal values)

S 35ECB

Monthly BulletinMay 2011

Total

By euro area residents

Total in euro 1) In euro In all currencies

Outstanding Gross issues Net issues Outstanding Gross issues Net issues Outstanding Gross issues Net issues Annual Seasonally adjusted 2)

amounts amounts amounts growth rates6-month

Net issues growth rates1 2 3 4 5 6 7 8 9 10 11 12

2010 Feb. 15,975.4 860.1 38.1 13,729.6 811.1 39.8 15,414.8 900.4 37.1 5.9 -9.8 3.1 Mar. 16,119.7 1,027.9 143.4 13,832.0 923.6 101.4 15,529.7 1,031.3 109.6 5.5 94.6 2.7 Apr. 16,163.0 1,003.9 45.6 13,883.5 947.9 53.5 15,613.1 1,054.4 77.1 5.2 50.1 3.1 May 16,170.5 867.5 9.1 13,920.5 839.6 38.5 15,722.0 944.1 58.6 4.3 -6.2 2.5 June 16,155.3 1,049.7 7.8 13,895.9 984.3 -1.4 15,702.9 1,081.6 -12.5 3.7 7.7 2.6 July 16,176.7 1,008.6 22.4 13,943.4 969.9 48.5 15,677.2 1,075.6 15.5 3.3 48.1 2.4 Aug. 16,241.6 840.9 65.1 14,005.5 800.6 62.4 15,783.4 902.8 82.2 3.7 143.6 4.4 Sep. 16,260.8 984.8 19.6 14,023.6 908.2 18.5 15,737.6 1,013.0 4.9 3.1 48.1 3.8 Oct. 16,268.6 887.8 10.5 14,061.4 843.0 40.4 15,775.8 949.5 52.6 3.2 24.6 3.4 Nov. 16,444.9 991.1 177.5 14,256.8 952.2 196.5 16,056.2 1,065.1 235.4 4.3 208.1 6.2 Dec. 16,279.7 873.1 -165.6 14,108.9 840.4 -148.3 15,863.1 912.4 -187.0 3.5 -137.2 4.3

2011 Jan. . . . 14,186.1 953.1 76.4 15,938.3 1,067.6 93.7 3.7 102.5 5.0 Feb. . . . 14,280.4 807.8 95.1 16,030.4 909.7 97.7 4.1 49.4 3.8

Long-term

2010 Feb. 14,443.8 212.2 56.8 12,309.3 193.7 63.4 13,785.4 211.7 62.1 7.5 13.3 4.8 Mar. 14,577.3 310.4 132.7 12,417.8 250.1 107.7 13,902.6 281.5 113.5 7.2 108.5 4.8 Apr. 14,623.6 246.8 47.3 12,464.9 223.5 47.8 13,978.3 255.3 68.4 7.1 54.5 4.6 May 14,634.8 154.4 11.7 12,498.1 148.4 33.6 14,085.2 181.7 59.5 6.0 -4.9 3.6 June 14,639.3 273.0 29.0 12,503.3 245.7 29.9 14,098.9 265.6 23.5 5.1 5.6 4.2 July 14,673.0 260.6 34.9 12,538.9 241.2 36.8 14,076.5 268.6 14.9 4.8 57.7 3.4 Aug. 14,704.4 140.8 32.1 12,570.1 127.4 32.0 14,142.2 152.8 43.7 4.7 104.6 4.8 Sep. 14,708.7 268.3 4.6 12,584.3 228.1 14.5 14,099.6 258.5 4.7 4.2 37.3 3.7 Oct. 14,746.2 222.2 37.7 12,633.8 195.5 49.6 14,155.2 232.7 65.6 4.1 58.7 3.7 Nov. 14,887.9 335.8 142.8 12,790.5 319.3 157.7 14,384.8 357.8 188.8 4.8 157.3 6.1 Dec. 14,849.1 185.6 -38.1 12,769.5 178.5 -20.3 14,331.5 192.4 -47.8 4.8 -45.5 5.4

2011 Jan. . . . 12,823.5 278.9 55.4 14,382.3 320.9 70.8 4.9 125.5 6.3 Feb. . . . 12,922.1 252.8 98.8 14,473.1 284.7 95.0 5.1 42.7 5.4

C15 Total outstanding amounts and gross issues of securities other than shares issued by euro area residents

(EUR billions)

2000

4000

6000

8000

10000

12000

14000

16000

18000

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 20100

200

400

600

800

1000

1200

1400

1600

total gross issues (right-hand scale)total outstanding amounts (left-hand scale)outstanding amounts in euro (left-hand scale)

Sources: ECB and BIS (for issues by non-euro area residents).1) Total euro-denominated securities other than shares issued by euro area residents and non-euro area residents.2) For details of the calculation of the growth rates, see the Technical Notes. The six-month growth rates have been annualised.

4.2 Securities other than shares issued by euro area residents, by sector of the issuer and instrument type (EUR billions ; transactions during the month and end-of-period outstanding amounts; nominal values)

S 36ECBMonthly BulletinMay 2011

1. Outstanding amounts and gross issues

Total

Outstanding amounts Gross issues 1)

Total MFIs Non-MFI corporations General government Total MFIs Non-MFI corporations General government

(including (includingEurosystem) Financial Non-financial Central Other Eurosystem) Financial Non-financial Central Other

corporations corporations government general corporations corporations government generalother than government other than government

MFIs MFIs1 2 3 4 5 6 7 8 9 10 11 12

2009 15,277 5,376 3,213 805 5,508 374 1,126 734 62 86 221 222010 15,863 5,255 3,276 855 6,022 454 1,006 625 77 71 208 25

2010 Q1 15,530 5,469 3,173 844 5,654 389 1,024 642 61 74 227 20 Q2 15,703 5,454 3,211 849 5,770 418 1,027 661 62 80 198 26 Q3 15,738 5,427 3,203 849 5,822 437 997 631 75 67 197 27 Q4 15,863 5,255 3,276 855 6,022 454 976 566 109 64 208 29

2010 Nov. 16,056 5,299 3,304 865 6,142 447 1,065 552 152 66 270 25 Dec. 15,863 5,255 3,276 855 6,022 454 912 586 100 56 137 32

2011 Jan. 15,938 5,303 3,292 829 6,074 440 1,068 629 81 64 255 39 Feb. 16,030 5,361 3,282 833 6,013 542 910 558 72 51 194 35

Short-term

2009 1,638 733 88 72 724 21 876 635 19 69 137 152010 1,532 572 116 67 732 45 758 534 31 60 117 17

2010 Q1 1,627 747 80 77 706 17 754 536 28 61 120 10 Q2 1,604 734 95 73 681 21 793 570 31 67 110 16 Q3 1,638 743 94 72 692 37 770 545 29 58 118 20 Q4 1,532 572 116 67 732 45 715 484 37 53 119 22

2010 Nov. 1,671 611 102 73 845 40 707 476 33 53 129 16 Dec. 1,532 572 116 67 732 45 720 504 41 52 97 27

2011 Jan. 1,556 593 118 71 739 35 747 496 29 54 136 32 Feb. 1,557 615 106 72 725 41 625 427 26 46 105 21

Long-term 2)

2009 13,639 4,643 3,125 733 4,784 353 251 99 44 17 84 72010 14,331 4,683 3,160 789 5,291 409 248 91 46 12 91 9

2010 Q1 13,903 4,722 3,093 767 4,948 372 270 106 33 13 107 10 Q2 14,099 4,720 3,116 775 5,089 398 234 91 31 13 89 10 Q3 14,100 4,684 3,110 776 5,130 400 227 86 46 9 79 6 Q4 14,331 4,683 3,160 789 5,291 409 261 82 73 11 89 7

2010 Nov. 14,385 4,688 3,201 792 5,297 407 358 76 119 13 141 9 Dec. 14,331 4,683 3,160 789 5,291 409 192 82 59 5 41 5

2011 Jan. 14,382 4,710 3,174 759 5,336 405 321 133 52 10 120 6 Feb. 14,473 4,746 3,176 761 5,288 501 285 131 46 5 88 14

of which: Long-term fixed rate

2009 8,829 2,586 1,034 599 4,338 271 173 60 18 16 74 42010 9,501 2,659 1,101 673 4,777 292 156 50 13 10 78 5

2010 Q1 9,097 2,658 1,053 627 4,482 278 186 61 10 12 95 7 Q2 9,312 2,663 1,083 655 4,625 286 156 47 12 11 81 5 Q3 9,335 2,649 1,070 659 4,670 286 141 48 12 8 70 4 Q4 9,501 2,659 1,101 673 4,777 292 142 42 20 10 65 5

2010 Nov. 9,524 2,679 1,107 674 4,773 290 182 49 20 12 96 6 Dec. 9,501 2,659 1,101 673 4,777 292 94 30 21 4 35 3

2011 Jan. 9,529 2,685 1,102 655 4,798 289 196 84 6 9 95 3 Feb. 9,612 2,723 1,101 658 4,751 379 190 80 16 5 79 10

of which: Long-term variable rate

2009 4,372 1,770 2,024 123 374 81 62 28 25 1 6 22010 4,359 1,746 1,955 108 435 116 77 34 29 1 10 4

2010 Q1 4,341 1,775 1,961 130 382 93 70 38 20 1 7 3 Q2 4,320 1,768 1,948 110 383 110 65 37 17 1 5 6 Q3 4,322 1,755 1,961 109 386 112 73 29 33 1 6 3 Q4 4,359 1,746 1,955 108 435 116 102 33 44 1 22 2

2010 Nov. 4,406 1,730 2,006 110 445 115 159 21 92 1 43 3 Dec. 4,359 1,746 1,955 108 435 116 72 46 18 0 6 2

2011 Jan. 4,366 1,744 1,960 96 451 114 99 38 40 1 18 3 Feb. 4,363 1,736 1,962 96 448 121 75 40 24 0 7 3

Source: ECB.1) Monthly data on gross issues refer to transactions during the month. For the purposes of comparison, quarterly and annual data refer to the respective monthly averages.2) The residual difference between total long-term debt securities and fixed and variable rate long-term debt securities consists of zero coupon bonds and revaluation effects.

EURO AREASTATISTICS

Financialmarkets

4.2 Securities other than shares issued by euro area residents, by sector of the issuer and instrument type (EUR billions unless otherwise indicated; transactions during the period; nominal values)

S 37ECB

Monthly BulletinMay 2011

2. Net issues

Total

Non-seasonally adjusted 1) Seasonally adjusted 1)

Total MFIs Non-MFI corporations General government Total MFIs Non-MFI corporations General government

(including (includingEurosystem) Financial Non-financial Central Other Eurosystem) Financial Non-financial Central Other

corporations corporations government general corporations corporations government generalother than government other than government

MFIs MFIs1 2 3 4 5 6 7 8 9 10 11 12

2009 87.0 10.2 19.2 8.5 46.2 2.8 86.7 10.1 18.8 8.2 46.7 2.92010 45.0 -1.1 4.4 5.1 31.4 5.1 44.5 -1.3 4.3 5.1 31.6 4.7

2010 Q1 71.0 25.7 -15.7 11.5 46.4 3.1 48.8 7.4 2.0 10.4 24.6 4.5 Q2 41.0 -12.5 8.1 5.0 34.9 5.6 17.2 -15.0 2.7 0.7 23.0 5.7 Q3 34.2 2.7 1.8 2.8 20.5 6.4 79.9 12.1 25.5 5.1 29.5 7.7 Q4 33.7 -20.1 23.2 1.2 24.0 5.4 31.8 -9.8 -12.9 4.1 49.4 1.1

2010 Nov. 235.4 10.8 75.3 4.2 140.3 4.9 208.1 9.2 68.3 4.0 123.6 3.0 Dec. -187.0 -44.4 -23.9 -8.2 -117.1 6.8 -137.2 -1.1 -97.9 0.8 -37.2 -1.7

2011 Jan. 93.7 58.1 -8.8 4.1 54.2 -13.8 102.5 49.1 23.4 1.1 32.3 -3.4 Feb. 97.7 61.4 -9.4 4.0 43.5 -1.8 49.4 33.6 1.5 2.4 13.3 -1.4

Long-term

2009 87.6 15.0 22.3 12.6 34.5 3.2 87.5 15.1 22.0 12.7 34.6 3.22010 54.2 2.0 2.1 5.5 41.4 3.1 54.3 2.0 2.0 5.6 41.6 3.1

2010 Q1 76.4 22.4 -13.0 10.0 52.8 4.3 75.6 12.6 5.2 10.7 43.0 4.2 Q2 50.4 -7.5 3.4 6.1 43.9 4.6 18.4 -17.4 -1.6 2.1 30.8 4.4 Q3 21.1 -1.4 2.1 3.1 16.3 0.9 66.5 6.3 24.3 5.0 28.6 2.3 Q4 68.8 -5.5 15.8 3.0 52.7 2.8 56.8 6.5 -19.7 4.5 63.9 1.6

2010 Nov. 188.8 -6.2 74.3 4.0 113.9 2.8 157.3 -5.4 65.8 3.5 92.2 1.2 Dec. -47.8 -5.4 -37.7 -1.9 -4.9 2.1 -45.5 28.8 -113.2 1.7 35.1 2.0

2011 Jan. 70.8 38.5 -9.3 -1.8 47.4 -3.9 125.5 45.9 25.6 -0.7 58.3 -3.6 Feb. 95.0 39.0 3.3 2.9 45.1 4.7 42.7 13.3 11.3 1.9 10.1 6.0

C16 Net issues of securities other than shares: seasonally adjusted and non-seasonally adjusted

(EUR billions; transactions during the month; nominal values)

-200

-150

-100

-50

0

50

100

150

200

250

2003 2004 2005 2006 2007 2008 2009 2010-200

-150

-100

-50

0

50

100

150

200

250

net issuesseasonally adjusted net issues

Source: ECB.1) Monthly data on net issues refer to transactions during the month. For the purposes of comparison, quarterly and annual data refer to the respective monthly averages.

4.3 Growth rates of securities other than shares issued by euro area residents 1) (percentage changes)

S 38ECBMonthly BulletinMay 2011

Total

Annual growth rates (non-seasonally adjusted) 6-month seasonally adjusted growth rates

Total MFIs Non-MFI corporations General government Total MFIs Non-MFI corporations General government

(including (includingEurosystem) Financial Non-financial Central Other Eurosystem) Financial Non-financial Central Other

corporations corporations government general corporations corporations government generalother than government other than government

MFIs MFIs1 2 3 4 5 6 7 8 9 10 11 12

2010 Feb. 5.9 0.7 6.2 15.0 9.7 11.0 3.1 -1.3 -1.9 15.4 8.1 11.6 Mar. 5.5 1.5 4.6 16.1 8.5 11.8 2.7 -0.4 -3.2 13.1 6.9 12.4 Apr. 5.2 1.3 3.6 16.1 8.4 11.2 3.1 2.2 -3.0 13.2 5.3 12.9 May 4.3 -0.2 2.9 14.9 8.0 10.4 2.5 0.1 -2.0 12.5 5.4 11.3 June 3.7 -0.4 1.8 12.3 7.2 13.7 2.6 -0.8 0.9 8.3 5.2 16.7 July 3.3 -0.9 0.6 10.1 7.4 15.2 2.4 -2.4 0.7 8.1 6.0 22.4 Aug. 3.7 -0.3 1.7 10.2 7.2 15.4 4.4 0.6 5.4 5.4 6.4 19.9 Sep. 3.1 -0.3 1.0 8.6 6.2 16.6 3.8 -0.3 5.4 4.2 5.6 21.1 Oct. 3.2 0.1 0.6 8.4 6.2 16.0 3.4 -2.0 4.3 3.9 7.1 19.0 Nov. 4.3 0.1 2.7 8.4 7.9 16.4 6.2 0.1 7.8 4.4 10.4 21.7 Dec. 3.5 -0.2 1.6 7.6 6.8 15.9 4.3 0.2 2.4 6.8 8.3 13.0

2011 Jan. 3.7 0.1 1.8 7.3 7.1 14.0 5.0 2.6 2.8 6.5 8.2 6.6 Feb. 4.1 1.6 2.3 5.6 6.7 11.6 3.8 2.7 -0.6 5.7 6.9 4.1

Long-term

2010 Feb. 7.5 3.3 7.1 22.4 9.7 12.5 4.8 0.3 -1.6 19.3 10.7 11.9 Mar. 7.2 3.8 5.5 22.6 9.2 12.8 4.8 1.3 -3.0 17.0 10.6 13.8 Apr. 7.1 3.2 4.4 21.5 10.4 11.1 4.6 1.7 -2.6 15.7 9.7 12.7 May 6.0 1.6 3.3 18.5 10.1 9.0 3.6 -0.8 -2.0 12.6 9.9 9.9 June 5.1 0.9 2.0 15.9 9.1 12.9 4.2 -0.6 0.7 10.7 9.4 14.7 July 4.8 0.2 0.7 12.7 10.2 12.1 3.4 -3.0 0.8 9.0 10.1 13.1 Aug. 4.7 -0.3 1.4 13.0 10.2 11.8 4.8 -1.0 4.6 7.0 9.7 11.7 Sep. 4.2 0.0 0.7 11.2 8.9 12.3 3.7 -1.4 4.4 5.7 7.3 10.8 Oct. 4.1 0.0 0.4 10.5 9.1 11.4 3.7 -1.7 3.4 5.6 8.5 10.0 Nov. 4.8 -0.4 2.4 9.7 10.4 11.3 6.1 -0.1 7.2 6.9 10.8 12.9 Dec. 4.8 0.5 0.8 9.1 10.4 10.3 5.4 1.7 0.9 7.6 11.3 6.1

2011 Jan. 4.9 0.4 1.0 8.3 10.9 8.6 6.3 4.1 1.1 7.6 11.7 4.3 Feb. 5.1 1.7 1.6 6.7 10.0 8.9 5.4 4.4 -1.3 6.4 10.3 6.2

C17 Annual growth rates of long-term debt securities, by sector of the issuer, in all currencies combined

(annual percentage changes)

-5

0

5

10

15

20

25

30

35

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010-5

0

5

10

15

20

25

30

35

general governmentMFIs (including Eurosystem)non-MFI corporations

Source: ECB.1) For details of the calculation of the growth rates, see the Technical Notes. The six-month growth rates have been annualised.

EURO AREASTATISTICS

Financialmarkets

4.3 Growth rates of securities other than shares issued by euro area residents 1) (cont'd) (percentage changes)

S 39ECB

Monthly BulletinMay 2011

In all currencies combined

Long-term fixed rate Long-term variable rate

Total MFIs Non-MFI corporations General government Total MFIs Non-MFI corporations General government

(including (includingEurosystem) Financial Non-financial Central Other Eurosystem) Financial Non-financial Central Other

corporations corporations government general corporations corporations government generalother than government other than government

MFIs MFIs13 14 15 16 17 18 19 20 21 22 23 24

2009 9.5 7.1 18.0 25.0 8.1 4.3 12.0 1.8 35.7 -1.9 0.1 20.82010 8.8 5.6 6.7 19.5 9.9 7.4 -0.3 -3.7 1.1 -1.3 6.8 26.1

2010 Q1 11.1 9.8 13.5 28.8 9.6 8.3 1.2 -3.9 5.8 -2.1 4.6 26.9 Q2 9.7 7.3 7.3 23.0 10.2 7.5 -1.0 -4.2 0.3 -0.4 5.5 23.4 Q3 7.5 3.1 3.4 16.1 10.1 7.2 -1.3 -3.7 -1.2 -1.8 4.8 28.5 Q4 7.0 2.7 3.3 12.3 9.7 6.8 0.0 -3.1 -0.5 -0.8 12.3 25.7

2010 Sep. 7.0 2.8 2.2 13.7 9.7 7.8 -1.0 -3.2 -0.7 -1.2 3.3 26.3 Oct. 6.9 2.9 3.0 12.7 9.4 7.1 -0.5 -3.2 -0.9 -1.1 8.7 25.4 Nov. 7.1 2.5 3.7 11.8 10.0 6.8 0.9 -3.8 0.8 -0.4 18.6 25.3 Dec. 7.0 2.6 4.2 11.0 9.9 5.2 0.3 -1.5 -2.2 -0.3 15.8 26.7

2011 Jan. 7.0 2.5 3.3 10.1 10.3 5.1 0.6 -1.6 -1.5 -0.2 17.8 19.1 Feb. 6.8 4.2 3.5 8.5 9.1 5.3 1.3 -1.2 -0.8 -2.2 20.8 19.5

In euro

2009 10.1 9.0 21.4 23.3 8.2 3.7 14.3 3.9 38.2 -2.4 -0.4 21.92010 9.0 5.5 7.8 19.9 10.0 7.3 -0.1 -3.2 0.9 -1.7 5.9 26.4

2010 Q1 11.4 10.8 14.9 29.2 9.7 8.0 1.6 -3.5 6.3 -2.4 3.2 26.9 Q2 9.9 7.4 8.3 23.5 10.2 7.2 -1.1 -3.9 -0.2 -0.6 4.1 23.4 Q3 7.9 2.7 4.5 16.4 10.3 7.2 -1.0 -3.0 -1.4 -2.5 4.1 28.6 Q4 7.2 1.6 4.4 12.8 9.9 6.9 0.4 -2.3 -0.9 -1.2 12.3 26.5

2010 Sep. 7.3 2.0 3.5 14.4 9.9 7.9 -0.6 -2.5 -0.6 -1.7 2.9 26.1 Oct. 7.1 1.9 4.2 13.2 9.5 7.2 -0.2 -2.5 -1.0 -1.5 8.6 26.1 Nov. 7.2 1.2 4.5 12.2 10.1 6.9 1.2 -2.9 0.1 -0.9 18.8 26.4 Dec. 7.2 1.3 5.2 11.6 10.1 5.5 0.7 -0.2 -2.8 -0.7 16.1 27.7

2011 Jan. 7.1 1.2 3.6 10.7 10.5 5.3 1.1 0.0 -2.5 -0.4 18.1 19.6 Feb. 6.9 3.1 3.8 8.9 9.2 5.8 2.0 0.8 -1.5 -2.5 21.0 19.9

C18 Annual growth rates of short-term debt securities, by sector of the issuer, in all currencies combined

(annual percentage changes)

-60

-40

-20

0

20

40

60

80

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010-60

-40

-20

0

20

40

60

80

general governmentMFIs (including Eurosystem)non-MFI corporations

Source: ECB.1) Annual percentage changes for monthly data refer to the end of the month, whereas those for quarterly and yearly data refer to the annual change in the period average. See the Technical Notes for details.

4.4 Quoted shares issued by euro area residents 1) (EUR billions, unless otherwise indicated; market values)

S 40ECBMonthly BulletinMay 2011

1. Outstanding amounts and annual growth rates(outstanding amounts as at end of period)

Total MFIs Financial corporations other than MFIs Non-financial corporations

Total Index: Annual Total Annual Total Annual Total AnnualDec. 2008 = 100 growth growth growth growth

rates (%) rates (%) rates (%) rates (%)

1 2 3 4 5 6 7 8 9

2009 Feb. 2,942.9 100.1 1.1 273.8 7.4 206.3 2.8 2,462.7 -0.1 Mar. 3,027.0 100.6 1.5 313.7 8.0 223.9 2.9 2,489.4 0.4 Apr. 3,459.1 100.7 1.6 410.4 8.3 274.6 3.0 2,774.0 0.5 May 3,605.5 101.0 1.9 448.8 8.9 283.3 2.9 2,873.4 0.8 June 3,557.5 101.8 2.7 445.3 9.9 279.4 3.9 2,832.7 1.5 July 3,842.8 102.0 2.7 505.7 9.6 301.1 3.6 3,036.0 1.6 Aug. 4,041.3 102.0 2.7 568.4 9.5 321.7 4.0 3,151.1 1.6 Sep. 4,210.4 102.1 2.8 588.4 8.4 352.3 4.1 3,269.7 1.8 Oct. 4,065.1 102.3 2.7 563.3 9.0 327.0 1.3 3,174.8 1.9 Nov. 4,079.4 102.6 2.7 563.8 8.8 318.5 2.2 3,197.2 1.9 Dec. 4,411.1 103.0 3.0 566.0 9.2 349.4 5.4 3,495.7 1.8

2010 Jan. 4,243.3 103.1 2.9 516.7 8.3 339.3 5.4 3,387.4 1.9 Feb. 4,162.0 103.2 3.0 499.3 8.3 337.8 5.5 3,324.9 2.0 Mar. 4,474.9 103.4 2.8 543.6 7.5 363.8 5.4 3,567.4 1.8 Apr. 4,409.6 103.4 2.7 508.4 7.1 344.3 5.4 3,557.0 1.7 May 4,093.9 103.5 2.4 445.9 6.3 321.4 5.4 3,326.6 1.5 June 4,055.1 103.7 1.9 446.4 5.7 314.3 4.4 3,294.4 1.0 July 4,256.6 103.7 1.7 519.8 5.1 336.8 4.6 3,399.9 0.9 Aug. 4,121.7 103.8 1.7 479.3 5.1 313.2 4.1 3,329.2 1.0 Sep. 4,345.8 103.8 1.7 487.0 5.1 325.3 4.0 3,533.4 0.9 Oct. 4,531.5 104.1 1.8 514.4 7.3 332.4 4.0 3,684.7 0.8 Nov. 4,409.7 104.3 1.7 437.8 6.8 311.3 3.8 3,660.6 0.8 Dec. 4,593.9 104.3 1.3 458.4 6.5 329.9 0.7 3,805.5 0.7

2011 Jan. 4,757.8 104.4 1.3 514.3 6.2 362.1 1.5 3,881.4 0.6 Feb. 4,843.7 104.6 1.4 534.6 6.8 376.3 2.3 3,932.7 0.6

C19 Annual growth rates for quoted shares issued by euro area residents

(annual percentage changes)

-4

-2

0

2

4

6

8

10

12

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010-4

-2

0

2

4

6

8

10

12

MFIsfinancial corporations other than MFIsnon-financial corporations

Source: ECB.1) For details of the calculation of the index and the growth rates, see the Technical Notes.

EURO AREASTATISTICS

Financialmarkets

4.4 Quoted shares issued by euro area residents (EUR billions; market values)

S 41ECB

Monthly BulletinMay 2011

2. Transactions during the month

Total MFIs Financial corporations other than MFIs Non-financial corporations

Gross issues Redemptions Net issues Gross issues Redemptions Net issues Gross issues Redemptions Net issues Gross issues Redemptions Net issues

1 2 3 4 5 6 7 8 9 10 11 12

2009 Feb. 0.2 0.9 -0.7 0.0 0.0 0.0 0.0 0.1 -0.1 0.2 0.8 -0.6 Mar. 13.7 0.2 13.4 3.6 0.0 3.6 0.2 0.0 0.1 9.9 0.2 9.7 Apr. 3.7 0.3 3.4 1.2 0.0 1.2 0.1 0.0 0.0 2.4 0.3 2.1 May 11.4 0.3 11.1 4.4 0.0 4.4 0.2 0.0 0.1 6.8 0.3 6.5 June 27.8 2.0 25.8 4.8 0.0 4.8 3.3 0.3 3.0 19.7 1.8 18.0 July 7.2 0.2 7.0 3.0 0.0 3.0 0.0 0.0 0.0 4.1 0.1 4.0 Aug. 4.0 3.3 0.7 0.0 0.0 0.0 1.3 0.0 1.3 2.7 3.3 -0.6 Sep. 5.0 0.3 4.7 0.6 0.0 0.6 0.2 0.0 0.2 4.2 0.2 3.9 Oct. 7.8 0.3 7.5 4.5 0.0 4.5 0.2 0.0 0.2 3.1 0.2 2.8 Nov. 11.6 0.2 11.4 9.0 0.0 9.0 1.0 0.0 1.0 1.6 0.2 1.4 Dec. 16.2 0.2 16.1 1.9 0.0 1.9 10.4 0.1 10.3 4.0 0.1 3.9

2010 Jan. 6.4 0.0 6.4 4.1 0.0 4.1 0.1 0.0 0.1 2.3 0.0 2.3 Feb. 2.2 0.3 1.9 0.0 0.0 0.0 0.2 0.0 0.2 2.0 0.3 1.7 Mar. 9.6 0.6 9.0 2.6 0.0 2.6 0.1 0.0 0.1 6.9 0.6 6.3 Apr. 1.8 0.4 1.5 0.1 0.0 0.0 0.0 0.0 0.0 1.8 0.3 1.5 May 3.2 0.8 2.4 1.9 0.0 1.9 0.1 0.0 0.1 1.3 0.8 0.4 June 8.4 0.4 8.0 2.2 0.0 2.2 0.4 0.0 0.4 5.8 0.4 5.4 July 3.6 0.8 2.7 0.7 0.0 0.7 0.5 0.0 0.5 2.4 0.8 1.6 Aug. 1.8 1.2 0.6 0.0 0.0 0.0 0.0 0.0 0.0 1.7 1.2 0.6 Sep. 1.6 0.2 1.4 0.2 0.0 0.2 0.0 0.0 0.0 1.4 0.2 1.2 Oct. 16.3 1.1 15.2 14.0 0.0 14.0 0.2 0.0 0.2 2.0 1.1 1.0 Nov. 8.2 1.2 7.0 5.9 0.0 5.9 0.2 0.1 0.2 2.1 1.2 0.9 Dec. 3.7 3.4 0.3 0.2 0.0 0.2 0.8 0.3 0.5 2.7 3.1 -0.4

2011 Jan. 6.1 1.3 4.8 1.7 0.0 1.7 2.6 0.0 2.6 1.8 1.3 0.5 Feb. 7.3 0.2 7.0 2.9 0.0 2.9 3.2 0.0 3.2 1.2 0.2 0.9

C20 Gross issues of quoted shares by sector of the issuer

(EUR billions; transactions during the month; market values)

0

5

10

15

20

25

30

35

40

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 20100

5

10

15

20

25

30

35

40

MFIsfinancial corporations other than MFIsnon-financial corporations

Source: ECB.

4.5 MFI interest rates on euro-denominated deposits from and loans to euro area residents 1) (percentages per annum; outstanding amounts as at end of period, new business as period average, unless otherwise indicated)

S 42ECBMonthly BulletinMay 2011

1. Interest rates on deposits (new business)

Deposits from households Deposits from non-financial corporations Repos

Overnight 2) With an agreed maturity of: Redeemable at notice of: 2), 3) Overnight 2) With an agreed maturity of:

Up to 1 year Over 1 and Over 2 years Up to 3 months Over 3 months Up to 1 year Over 1 and Over 2 yearsup to 2 years up to 2 years

1 2 3 4 5 6 7 8 9 10 11

2010 Apr. 0.41 2.02 2.64 2.14 1.42 2.01 0.43 0.78 2.78 2.30 0.58 May 0.40 2.04 2.73 2.24 1.40 1.98 0.43 0.77 2.78 2.26 0.52 June 0.43 2.16 2.26 2.47 1.41 1.96 0.43 0.89 1.85 2.29 0.66 July 0.43 2.31 2.59 2.36 1.40 1.93 0.45 1.06 2.11 2.23 0.74 Aug. 0.43 2.21 2.54 2.36 1.50 1.91 0.45 1.01 2.01 2.22 0.70 Sep. 0.43 2.25 2.76 2.28 1.55 1.85 0.46 1.11 2.18 2.81 0.71 Oct. 0.43 2.35 2.75 2.80 1.54 1.82 0.50 1.18 2.36 2.53 0.94 Nov. 0.44 2.33 2.65 2.67 1.54 1.83 0.50 1.16 2.45 2.41 0.90 Dec. 0.43 2.27 2.77 2.59 1.55 1.84 0.51 1.19 2.56 2.60 1.07

2011 Jan. 0.43 2.38 2.61 2.77 1.53 1.85 0.54 1.29 2.42 2.52 1.02 Feb. 0.44 2.36 2.74 2.80 1.60 1.86 0.52 1.32 2.37 2.69 1.04 Mar. 0.45 2.34 2.78 2.89 1.61 1.88 0.54 1.37 2.53 2.80 1.09

2. Interest rates on loans to households (new business)

Revolving Consumer credit Lending for house purchase Other lendingloans and by initial rate fixation

overdrafts, By initial rate fixation Annual By initial rate fixation Annual convenience percentage percentage

and extended Floating rate Over 1 Over rate of Floating rate Over 1 Over 5 Over rate of Floating rate Over 1 Overcredit card and up to and up to 5 years charge 4) and up to and up to and up to 10 years charge 4) and up to and up to 5 years

debt 2) 1 year 5 years 1 year 5 years 10 years 1 year 5 years

1 2 3 4 5 6 7 8 9 10 11 12 13

2010 Apr. 8.77 6.78 6.12 7.92 7.67 2.62 3.71 4.18 4.12 3.68 3.06 4.32 4.53 May 8.77 6.69 6.14 7.84 7.62 2.58 3.64 4.14 4.01 3.58 3.09 4.45 4.50 June 8.86 5.18 6.13 7.74 7.12 2.56 3.59 4.06 3.90 3.54 3.01 4.22 4.27 July 8.78 5.48 6.22 7.77 7.32 2.66 3.60 3.94 3.84 3.64 3.15 4.29 4.27 Aug. 8.78 5.38 6.26 7.87 7.37 2.83 3.62 3.95 3.81 3.76 3.35 4.52 4.14 Sep. 8.81 5.52 6.18 7.87 7.33 2.75 3.56 3.84 3.74 3.62 3.33 4.35 4.07 Oct. 8.73 5.36 6.03 7.71 7.17 2.76 3.55 3.78 3.69 3.61 3.37 4.43 4.21 Nov. 8.67 5.39 6.08 7.64 7.17 2.80 3.53 3.76 3.70 3.65 3.55 4.37 4.17 Dec. 8.64 5.16 5.95 7.23 6.89 2.78 3.52 3.80 3.71 3.68 3.39 4.31 4.15

2011 Jan. 8.70 5.05 6.13 7.83 7.18 2.94 3.69 3.91 3.84 3.83 3.37 4.32 4.30 Feb. 8.85 5.38 6.13 7.83 7.31 2.96 3.83 4.06 3.92 3.90 3.51 4.71 4.47 Mar. 8.84 5.44 6.23 7.83 7.33 3.01 3.82 4.15 4.03 3.96 3.57 4.77 4.61

3. Interest rates on loans to non-financial corporations (new business)

Revolving Other loans of up to EUR 1 million Other loans of over EUR 1 millionloans and by initial rate fixation by initial rate fixation

overdrafts,convenience Floating rate and Over 1 and Over 5 years Floating rate and Over 1 and Over 5 years

and extended up to 1 year up to 5 years up to 1 year up to 5 yearscredit card

debt 2)

1 2 3 4 5 6 7

2010 Apr. 3.98 3.19 4.17 3.90 2.00 2.72 3.45 May 3.97 3.25 4.12 3.86 1.96 2.84 3.41 June 3.70 3.25 4.09 3.80 2.17 2.86 3.37 July 3.70 3.30 4.23 3.95 2.25 2.85 3.20 Aug. 3.75 3.39 4.14 3.84 2.28 2.91 3.65 Sep. 3.80 3.35 4.10 3.78 2.26 2.72 3.51 Oct. 3.83 3.45 4.16 3.82 2.32 2.94 3.46 Nov. 3.85 3.56 4.26 3.82 2.42 3.05 3.53 Dec. 3.86 3.50 4.18 3.86 2.59 2.82 3.51

2011 Jan. 4.00 3.46 4.15 3.86 2.45 2.95 3.74 Feb. 4.01 3.60 4.37 4.03 2.62 3.29 3.81 Mar. 4.02 3.70 4.49 4.19 2.62 2.90 3.84

Source: ECB.1) Data refer to the changing composition of the euro area. For further information, see the General Notes.2) For this instrument category, new business and outstanding amounts coincide. End of period. Data as of June 2010 may not be fully comparable with those prior to that date

owing to methodological changes arising from the implementation of Regulations ECB/2008/32 and ECB/2009/7 (amending Regulation ECB/2001/18).3) For this instrument category, households and non-financial corporations are merged and allocated to the household sector, since the outstanding amounts of non-financial

corporations are negligible compared with those of the household sector when all participating Member States are combined.4) The annual percentage rate of charge covers the total cost of a loan. The total cost comprises both an interest rate component and a component incorporating

other (related) charges, such as the cost of inquiries, administration, preparation of documents and guarantees.

EURO AREASTATISTICS

Financialmarkets

4.5 MFI interest rates on euro-denominated deposits from and loans to euro area residents 1), * (percentages per annum; outstanding amounts as at end of period, new business as period average, unless otherwise indicated)

S 43ECB

Monthly BulletinMay 2011

4. Interest rates on deposits (outstanding amounts)

Deposits from households Deposits from non-financial corporations Repos

Overnight 2) With an agreed maturity of: Redeemable at notice of: 2),3) Overnight 2) With an agreed maturity of:

Up to 2 years Over 2 years Up to 3 months Over 3 months Up to 2 years Over 2 years

1 2 3 4 5 6 7 8 9

2010 Apr. 0.41 2.12 2.74 1.42 2.01 0.43 1.37 3.24 1.16 May 0.40 2.12 2.71 1.40 1.98 0.43 1.42 3.22 1.14 June 0.43 2.13 2.72 1.41 1.96 0.43 1.47 3.11 1.24 July 0.43 2.15 2.73 1.40 1.93 0.45 1.55 3.14 1.24 Aug. 0.43 2.17 2.72 1.50 1.91 0.45 1.57 3.11 1.25 Sep. 0.43 2.19 2.74 1.55 1.85 0.46 1.62 3.07 1.26 Oct. 0.43 2.22 2.70 1.54 1.82 0.50 1.68 3.07 1.29 Nov. 0.44 2.25 2.72 1.54 1.83 0.50 1.70 3.11 1.33 Dec. 0.43 2.28 2.70 1.55 1.84 0.51 1.76 3.08 1.50

2011 Jan. 0.43 2.31 2.71 1.53 1.85 0.54 1.78 3.07 1.55 Feb. 0.44 2.34 2.73 1.60 1.86 0.52 1.80 3.09 1.59 Mar. 0.45 2.37 2.71 1.61 1.88 0.54 1.85 3.14 1.61

5. Interest rates on loans (outstanding amounts)

Loans to households Loans to non-financial corporations

Lending for house purchase Consumer credit and other loans With a maturity of:

with a maturity of: with a maturity of:

Up to 1 year Over 1 and Over 5 years Up to 1 year Over 1 and Over 5 years Up to 1 year Over 1 and Over 5 yearsup to 5 years up to 5 years up to 5 years

1 2 3 4 5 6 7 8 9

2010 Apr. 3.89 4.01 3.92 7.38 6.50 5.29 3.42 3.21 3.33 May 3.87 3.97 3.89 7.40 6.45 5.29 3.40 3.20 3.31 June 3.79 3.96 3.84 7.68 6.48 5.21 3.29 3.22 3.30 July 3.73 3.93 3.82 7.75 6.50 5.19 3.34 3.25 3.33 Aug. 3.79 3.89 3.81 7.79 6.46 5.20 3.37 3.29 3.34 Sep. 3.83 3.88 3.83 7.89 6.46 5.22 3.42 3.29 3.38 Oct. 3.80 3.86 3.83 7.86 6.45 5.20 3.48 3.34 3.38 Nov. 3.77 3.86 3.85 7.73 6.47 5.22 3.51 3.39 3.42 Dec. 3.73 3.83 3.81 7.70 6.41 5.19 3.49 3.41 3.42

2011 Jan. 3.71 3.80 3.80 7.82 6.40 5.17 3.60 3.44 3.42 Feb. 3.68 3.81 3.82 7.85 6.43 5.20 3.64 3.47 3.47 Mar. 3.71 3.80 3.84 7.89 6.39 5.19 3.68 3.51 3.50

C21 New deposits with an agreed maturity

(percentages per annum excluding charges; period averages)

C22 New loans with a floating rate and up to 1 year's initial

rate fixation (percentages per annum excluding charges; period averages)

0.50

1.00

1.50

2.00

2.50

3.00

3.50

4.00

4.50

5.00

2003 2004 2005 2006 2007 2008 2009 20100.50

1.00

1.50

2.00

2.50

3.00

3.50

4.00

4.50

5.00

by households, up to 1 yearby non-financial corporations, up to 1 yearby households, over 2 yearsby non-financial corporations, over 2 years

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

9.00

2003 2004 2005 2006 2007 2008 2009 20101.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

9.00

to households for consumptionto households for house purchaseto non-financial corporations, up to EUR 1 millionto non-financial corporations, over EUR 1 million

Source: ECB.* For the source of the data in the table and the related footnotes, please see page S42.

4.6 Money market interest rates (percentages per annum; period averages)

S 44ECBMonthly BulletinMay 2011

Euro area 1), 2) United States Japan

Overnight 1-month 3-month 6-month 12-month 3-month 3-monthdeposits deposits deposits deposits deposits deposits deposits

(EONIA) (EURIBOR) (EURIBOR) (EURIBOR) (EURIBOR) (LIBOR) (LIBOR)

1 2 3 4 5 6 7

2008 3.87 4.28 4.64 4.73 4.83 2.93 0.932009 0.71 0.89 1.22 1.43 1.61 0.69 0.472010 0.44 0.57 0.81 1.08 1.35 0.34 0.23

2010 Q1 0.34 0.42 0.66 0.96 1.22 0.26 0.25 Q2 0.35 0.43 0.69 0.98 1.25 0.44 0.24 Q3 0.45 0.61 0.87 1.13 1.40 0.39 0.24 Q4 0.59 0.81 1.02 1.25 1.52 0.29 0.192011 Q1 0.67 0.86 1.10 1.37 1.74 0.31 0.19

2010 Apr. 0.35 0.40 0.64 0.96 1.23 0.31 0.24 May 0.34 0.42 0.69 0.98 1.25 0.46 0.24 June 0.35 0.45 0.73 1.01 1.28 0.54 0.24 July 0.48 0.58 0.85 1.10 1.37 0.51 0.24 Aug. 0.43 0.64 0.90 1.15 1.42 0.36 0.24 Sep. 0.45 0.62 0.88 1.14 1.42 0.29 0.22 Oct. 0.70 0.78 1.00 1.22 1.50 0.29 0.20 Nov. 0.59 0.83 1.04 1.27 1.54 0.29 0.19 Dec. 0.50 0.81 1.02 1.25 1.53 0.30 0.18

2011 Jan. 0.66 0.79 1.02 1.25 1.55 0.30 0.19 Feb. 0.71 0.89 1.09 1.35 1.71 0.31 0.19 Mar. 0.66 0.90 1.18 1.48 1.92 0.31 0.20 Apr. 0.97 1.13 1.32 1.62 2.09 0.28 0.20

C23 Euro area money market rates 1), 2)

(monthly averages; percentages per annum)

C24 3-month money market rates

(monthly averages; percentages per annum)

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

9.00

1994 1996 1998 2000 2002 2004 2006 2008 20100.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

9.00

1-month rate3-month rate12-month rate

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

9.00

1994 1996 1998 2000 2002 2004 2006 2008 20100.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

9.00

euro areaJapanUnited States

Source: ECB.1) Before January 1999 synthetic euro area rates were calculated on the basis of national rates weighted by GDP. For further information, see the General Notes.2) Data refer to the changing composition of the euro area. For further information, see the General Notes.

1), 2)

EURO AREASTATISTICS

Financialmarkets

4.7 Euro area yield curves 1)

(AAA-rated euro area central government bonds; end of period; rates in percentages per annum; spreads in percentage points)

S 45ECB

Monthly BulletinMay 2011

Spot rates Instantaneous forward rates

3 months 1 year 2 years 5 years 7 years 10 years 10 years 10 years 1 year 2 years 5 years 10 years- 3 months - 2 years

(spread) (spread)1 2 3 4 5 6 7 8 9 10 11 12

2008 1.75 1.85 2.14 2.95 3.32 3.69 1.94 1.55 2.09 2.76 4.04 4.602009 0.38 0.81 1.38 2.64 3.20 3.76 3.38 2.38 1.41 2.44 4.27 5.202010 0.49 0.60 0.93 2.15 2.78 3.36 2.87 2.43 0.85 1.70 3.99 4.69

2010 Q1 0.33 0.60 1.05 2.28 2.86 3.46 3.13 2.41 1.02 1.98 3.96 5.02 Q2 0.34 0.42 0.69 1.79 2.41 3.03 2.68 2.33 0.62 1.35 3.54 4.52 Q3 0.57 0.68 0.90 1.71 2.18 2.67 2.10 1.77 0.86 1.41 3.01 3.91 Q4 0.49 0.60 0.93 2.15 2.78 3.36 2.87 2.43 0.85 1.70 3.99 4.692011 Q1 0.87 1.30 1.79 2.83 3.26 3.66 2.79 1.87 1.84 2.69 4.12 4.63

2010 Apr. 0.32 0.60 1.01 2.18 2.78 3.40 3.07 2.39 1.00 1.85 3.89 4.94 May 0.21 0.28 0.57 1.75 2.39 3.00 2.78 2.43 0.47 1.28 3.58 4.46 June 0.34 0.42 0.69 1.79 2.41 3.03 2.68 2.33 0.62 1.35 3.54 4.52 July 0.45 0.59 0.87 1.88 2.44 3.01 2.56 2.14 0.82 1.51 3.45 4.43 Aug. 0.43 0.45 0.62 1.47 1.97 2.48 2.05 1.85 0.55 1.09 2.87 3.70 Sep. 0.57 0.68 0.90 1.71 2.18 2.67 2.10 1.77 0.86 1.41 3.01 3.91 Oct. 0.75 0.84 1.06 1.89 2.36 2.86 2.11 1.80 1.02 1.57 3.21 4.09 Nov. 0.63 0.72 0.99 2.02 2.58 3.11 2.48 2.12 0.92 1.62 3.62 4.35 Dec. 0.49 0.60 0.93 2.15 2.78 3.36 2.87 2.43 0.85 1.70 3.99 4.69

2011 Jan. 0.65 1.03 1.48 2.55 3.03 3.49 2.84 2.01 1.51 2.34 3.96 4.62 Feb. 0.69 1.08 1.53 2.55 3.02 3.49 2.80 1.96 1.56 2.37 3.91 4.67 Mar. 0.87 1.30 1.79 2.83 3.26 3.66 2.79 1.87 1.84 2.69 4.12 4.63 Apr. 1.02 1.41 1.86 2.80 3.19 3.55 2.53 1.70 1.90 2.67 3.96 4.46

C25 Euro area spot yield curves 2)

(percentages per annum; end of period)

C26 Euro area spot rates and spreads 2)

(daily data; rates in percentages per annum; spreads in percentage points)

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

0 5yrs 10yrs 15yrs 20yrs 25yrs 30yrs

April 2011March 2011February 2011

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q12009 2010

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

1-year rate (left-hand scale)10-year rate (left-hand scale)spread between 10-year and 3-month rates (right-hand scale)spread between 10-year and 2-year rates (right-hand scale)

Sources: ECB calculations based on underlying data provided by EuroMTS and ratings provided by Fitch Ratings.1) Data refer to the changing composition of the euro area. For further information, see the General Notes.2) Data cover AAA-rated euro area central government bonds.

4.8 Stock market indices (index levels in points; period averages)

S 46ECBMonthly BulletinMay 2011

Dow Jones EURO STOXX indices 1) United Japan

States Benchmark Main industry indices

Broad 50 Basic Consumer Consumer Oil and Financials Industrials Technology Utilities Telecoms Health care Standard Nikkeiindex materials services goods gas & Poor’s 225

500

1 2 3 4 5 6 7 8 9 10 11 12 13 14

2008 313.7 3,319.5 480.4 169.3 290.7 380.9 265.0 350.9 282.5 502.0 431.5 411.5 1,220.7 12,151.62009 234.2 2,521.0 353.2 140.5 244.5 293.5 172.1 269.7 200.7 353.7 380.4 363.5 946.2 9,321.62010 265.5 2,779.3 463.1 166.2 323.4 307.2 182.8 337.6 224.1 344.9 389.6 408.4 1,140.0 10,006.5

2010 Q1 268.0 2,849.0 445.0 159.3 294.9 320.0 195.5 326.7 229.9 372.4 398.8 426.3 1,123.6 10,511.2 Q2 261.1 2,735.7 446.3 163.7 312.9 305.0 178.8 334.3 229.1 349.6 372.2 412.0 1,134.6 10,345.9 Q3 259.5 2,715.9 445.8 165.2 323.0 294.5 181.6 327.0 210.7 325.9 387.6 391.4 1,096.2 9,356.0 Q4 273.4 2,817.8 513.8 176.1 361.3 309.9 175.7 361.9 227.0 333.0 399.2 405.0 1,204.6 9,842.42011 Q1 285.5 2,932.9 532.7 175.5 366.3 341.1 185.0 388.0 249.6 347.7 396.7 415.0 1,302.5 10,285.3

2010 Apr. 278.6 2,937.3 470.9 171.7 313.8 328.6 199.7 349.0 248.8 378.9 396.7 430.0 1,197.3 11,139.8 May 252.7 2,642.1 431.4 159.6 305.2 295.4 170.8 324.8 221.9 341.7 360.0 401.0 1,125.1 10,104.0 June 253.2 2,641.7 438.1 160.4 319.5 292.7 167.5 330.0 218.3 330.5 361.6 406.1 1,083.4 9,786.1 July 255.1 2,669.5 435.0 160.8 320.8 289.3 178.0 324.2 212.3 320.3 369.7 389.2 1,079.8 9,456.8 Aug. 258.9 2,712.2 441.5 163.2 315.6 296.0 183.7 324.9 206.8 328.5 392.2 383.1 1,087.3 9,268.2 Sep. 264.6 2,766.1 460.9 171.6 332.4 298.4 183.0 331.9 212.9 329.0 400.9 401.8 1,122.1 9,346.7 Oct. 271.3 2,817.7 489.1 175.1 346.1 304.9 183.2 346.0 223.7 331.4 410.5 405.4 1,171.6 9,455.1 Nov. 272.2 2,809.6 509.9 176.3 359.9 307.4 174.4 358.5 222.9 335.0 403.0 405.0 1,198.9 9,797.2 Dec. 276.5 2,825.6 540.1 176.8 376.5 316.7 170.0 379.7 234.1 332.6 385.3 404.6 1,241.5 10,254.5

2011 Jan. 282.8 2,900.7 531.1 178.1 375.3 335.1 178.0 385.8 246.1 346.2 390.7 411.8 1,282.6 10,449.5 Feb. 292.3 3,015.7 540.5 179.0 369.7 348.0 193.5 393.1 257.6 359.0 402.9 418.7 1,321.1 10,622.3 Mar. 281.9 2,890.4 527.4 170.1 355.0 340.5 184.1 385.7 245.9 339.1 396.8 414.6 1,304.5 9,852.4 Apr. 287.5 2,947.2 557.3 172.5 366.6 343.8 182.4 397.9 250.0 346.9 402.8 435.4 1,331.5 9,644.6

C27 Dow Jones EURO STOXX broad index, Standard & Poor's 500 and Nikkei 225

(January 1994 = 100; monthly averages)

0

50

100

150

200

250

300

350

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 20100

50

100

150

200

250

300

350

Dow Jones EURO STOXX broad indexStandard & Poor’s 500Nikkei 225

Source: ECB.1) Data refer to the changing composition of the euro area. For further information, see the General Notes.

1)

LABOUR MARKETS 5PRICES, OUTPUT, DEMAND AND

5.1 HICP, other prices and costs (annual percentage changes, unless otherwise indicated)

S 47ECB

Monthly BulletinMay 2011

1. Harmonised Index of Consumer Prices 1)

Total Total (s.a.; percentage change vis-à-vis previous period) Memo item: Administered prices 2)

Index: Total Goods Services Total Processed Unprocessed Non-energy Energy Services2005 = 100 food food industrial (n.s.a.) Total HICP Administered

Total excl. goods excluding pricesunprocessed administered

food and energy prices

% of totalin 2011 100.0 100.0 82.3 58.6 41.4 100.0 11.9 7.4 28.9 10.4 41.4 88.8 11.2

1 2 3 4 5 6 7 8 9 10 11 12 13

2007 104.4 2.1 2.0 1.9 2.5 - - - - - - 2.1 2.22008 107.8 3.3 2.4 3.8 2.6 - - - - - - 3.4 2.72009 108.1 0.3 1.3 -0.9 2.0 - - - - - - 0.1 1.82010 109.8 1.6 1.0 1.8 1.4 - - - - - - 1.6 1.5

2010 Q1 108.6 1.1 0.9 0.9 1.5 0.5 0.0 0.9 0.1 3.0 0.2 1.2 0.4 Q2 110.1 1.6 0.9 1.9 1.2 0.7 0.3 0.7 0.3 3.9 0.3 1.6 1.3 Q3 109.9 1.7 1.0 2.0 1.4 0.3 0.5 0.5 0.1 0.0 0.5 1.7 2.0 Q4 110.8 2.0 1.1 2.5 1.3 0.5 0.5 0.6 0.2 2.0 0.3 2.0 2.32011 Q1 111.3 2.5 1.3 3.1 1.6 1.0 0.8 0.5 -0.1 6.3 0.5 2.4 3.4

2010 Nov. 110.6 1.9 1.2 2.3 1.3 0.2 0.2 0.4 0.1 0.8 0.1 1.9 2.4 Dec. 111.3 2.2 1.1 2.9 1.3 0.3 0.3 0.4 0.0 2.3 0.1 2.2 2.3

2011 Jan. 110.5 2.3 1.2 2.9 1.5 0.4 0.2 -0.4 0.0 3.0 0.2 2.2 3.2 Feb. 111.0 2.4 1.1 3.0 1.6 0.1 0.3 0.6 -0.5 0.9 0.2 2.3 3.4 Mar. 112.5 2.7 1.5 3.4 1.6 0.6 0.4 0.2 0.7 2.5 0.3 2.6 3.5 Apr. 3) . 2.8 . . . . . . . . . . .

Goods Services

Food (incl. alcoholic beverages and tobacco) Industrial goods Housing Transport Communication Recreation Miscellaneous

andTotal Processed Unprocessed Total Non-energy Energy Rents personal

food food industrialgoods

% of totalin 2011 19.3 11.9 7.4 39.3 28.9 10.4 10.1 6.0 6.5 3.2 14.6 7.0

14 15 16 17 18 19 20 21 22 23 24 25

2007 2.8 2.8 3.0 1.4 1.0 2.6 2.7 2.0 2.6 -1.9 2.9 3.22008 5.1 6.1 3.5 3.1 0.8 10.3 2.3 1.9 3.9 -2.2 3.2 2.52009 0.7 1.1 0.2 -1.7 0.6 -8.1 2.0 1.8 2.9 -1.0 2.1 2.12010 1.1 0.9 1.3 2.2 0.5 7.4 1.8 1.5 2.3 -0.8 1.0 1.5

2010 Q1 0.1 0.6 -0.6 1.3 0.1 4.8 1.9 1.6 2.5 -0.5 1.1 1.6 Q2 0.9 0.8 1.0 2.4 0.5 8.1 1.8 1.5 2.3 -0.9 0.8 1.5 Q3 1.5 0.9 2.3 2.2 0.5 7.3 1.8 1.6 2.5 -0.8 1.0 1.5 Q4 1.9 1.3 2.7 2.9 0.8 9.2 1.6 1.3 1.9 -0.8 1.2 1.52011 Q1 2.2 2.1 2.3 3.6 0.5 12.7 1.8 1.3 2.0 -0.4 1.5 1.9

2010 Oct. 1.6 1.2 2.3 2.7 0.8 8.5 1.6 1.3 1.9 -1.0 1.3 1.5 Nov. 1.8 1.3 2.6 2.6 0.9 7.9 1.6 1.2 2.0 -0.8 1.2 1.5 Dec. 2.1 1.5 3.2 3.2 0.7 11.0 1.7 1.3 1.7 -0.7 1.2 1.4

2011 Jan. 1.9 1.8 2.2 3.4 0.5 12.0 1.7 1.3 1.5 -0.2 1.6 1.7 Feb. 2.3 2.0 2.7 3.4 0.1 13.1 1.8 1.3 2.2 -0.4 1.6 1.9 Mar. 2.4 2.5 2.2 4.0 0.9 13.0 1.8 1.3 2.3 -0.6 1.5 2.2

Sources: Eurostat and ECB calculations.1) Data refer to the changing composition of the euro area. For further information, see the General Notes.2) These experimental statistics can only provide an approximate measure of price administration, since changes in administered prices cannot be fully isolated from other influences. Please refer to Eurostat’s website (http://epp.eurostat.ec.europa.eu/portal/page/portal/hicp/introduction) for a note explaining the methodology used in the compilation of this indicator.3) Estimate based on provisional national releases, which usually cover around 95% of the euro area, as well as on early information on energy prices.

5.1 HICP, other prices and costs (annual percentage changes, unless otherwise indicated)

S 48ECBMonthly BulletinMay 2011

2. Industry, construction and residential property prices

Industrial producer prices excluding construction Construct- Residential

ion 1) propertyTotal Total Industry excluding construction and energy Energy prices 2)

(index: 2005 = 100) Manu- Total Intermediate Capital Consumer goods

facturing goods goodsTotal Durable Non-durable

% of totalin 2005 100.0 100.0 82.8 75.6 30.0 22.0 23.7 2.7 21.0 24.4

1 2 3 4 5 6 7 8 9 10 11 12

2007 107.9 2.7 3.0 3.2 4.6 2.2 2.2 2.4 2.2 1.2 4.2 4.62008 114.4 6.1 4.8 3.4 3.9 2.1 3.9 2.8 4.1 14.2 3.9 1.32009 108.6 -5.1 -5.4 -2.9 -5.3 0.4 -2.1 1.2 -2.5 -11.8 0.1 -2.82010 111.7 2.9 3.4 1.6 3.5 0.3 0.4 0.9 0.3 6.4 1.9 1.8

2010 Q1 109.6 -0.1 1.7 -0.5 -0.4 -0.5 -0.6 0.3 -0.7 0.3 0.2 0.1 Q2 111.5 3.0 3.8 1.6 3.6 0.2 0.0 0.6 -0.1 7.2 2.4 1.6 Q3 112.3 4.0 3.7 2.3 4.8 0.7 0.6 1.1 0.5 8.8 2.4 2.6 Q4 113.5 4.7 4.5 3.1 5.9 0.8 1.5 1.4 1.5 9.6 2.8 2.92011 Q1 116.6 6.4 6.2 4.3 7.8 1.2 2.4 1.7 2.5 12.5 . .

2010 Oct. 112.9 4.3 4.1 2.9 5.5 0.7 1.2 1.3 1.2 8.7 - - Nov. 113.3 4.5 4.3 3.1 5.8 0.9 1.5 1.5 1.4 8.8 - - Dec. 114.3 5.4 5.2 3.3 6.3 0.7 1.8 1.5 1.8 11.2 - -

2011 Jan. 115.8 6.0 5.7 4.0 7.3 1.2 2.0 1.6 2.1 11.8 - - Feb. 116.7 6.6 6.4 4.5 8.2 1.3 2.5 1.8 2.6 12.7 - - Mar. 117.4 6.7 6.5 4.5 7.9 1.2 2.8 1.8 2.9 13.0 - -

3. Commodity prices and gross domestic product deflators

Oil prices 3) Non-energy commodity prices GDP deflators

(EUR per barrel) Import-weighted 4) Use-weighted 5) Total Total Domestic demand Exports 6) Imports 6)

(s.a.; index:Total Food Non-food Total Food Non-food 2000 = 100) Total Private Government Gross

consump- consump- fixedtion tion capital

formation

% of total 100.0 35.0 65.0 100.0 45.0 55.0

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

2007 52.8 7.8 14.3 5.5 5.3 9.3 2.9 116.4 2.4 2.3 2.3 1.7 2.7 1.6 1.32008 65.9 2.0 18.4 -4.4 -1.7 9.7 -8.6 118.8 2.1 2.6 2.7 2.6 2.3 2.6 3.92009 44.6 -18.5 -8.9 -23.0 -18.0 -11.4 -22.8 120.0 1.0 0.0 -0.2 2.0 -0.7 -3.3 -5.92010 60.7 44.7 21.4 57.9 42.1 27.1 54.5 121.0 0.8 1.6 1.8 0.8 1.0 3.4 5.5

2009 Q4 51.2 3.1 5.7 1.8 2.4 -1.0 5.0 120.2 0.4 -0.1 0.1 1.2 -1.1 -2.3 -3.82010 Q1 56.0 29.0 7.4 42.6 27.4 7.5 46.5 120.4 0.5 1.0 1.0 1.1 -0.3 1.2 2.4 Q2 62.6 48.2 12.5 70.2 41.7 14.0 67.3 120.8 0.8 1.7 1.7 1.1 0.9 3.8 6.4 Q3 59.6 51.5 29.7 63.1 49.4 41.0 55.8 121.3 1.1 1.9 2.0 0.3 1.6 4.2 6.4 Q4 64.4 48.6 36.6 54.7 48.7 48.4 48.9 121.3 1.0 1.9 2.3 0.7 1.8 4.3 7.0

2010 Nov. 63.1 48.6 35.3 55.5 47.3 44.4 49.5 - - - - - - - - Dec. 69.6 49.6 39.5 54.9 48.5 48.9 48.2 - - - - - - - -

2011 Jan. 72.6 46.0 42.9 47.5 43.9 46.5 42.0 - - - - - - - - Feb. 76.6 47.5 51.0 45.9 45.3 51.4 40.9 - - - - - - - - Mar. 82.1 35.7 44.4 31.8 34.1 43.8 27.6 - - - - - - - - Apr. 85.1 15.2 37.9 6.5 17.6 36.0 6.8 - - - - - - - -

Sources: Eurostat, ECB calculations based on Eurostat data (column 7 in Table 2 in Section 5.1 and columns 8-15 in Table 3 in Section 5.1), ECB calculations based onThomson Reuters data (column 1 in Table 3 in Section 5.1) and ECB calculations (column 12 in Table 2 in Section 5.1 and columns 2-7 in Table 3 in Section 5.1).1) Input prices for residential buildings.2) Experimental data based on non-harmonised national sources (see http://www.ecb.europa.eu/stats/intro/html/experiment.en.html for further details).3) Brent Blend (for one-month forward delivery).4) Refers to prices expressed in euro. Weighted according to the structure of euro area imports in the period 2004-06.5) Refers to prices expressed in euro. Weighted according to euro area domestic demand (domestic production plus imports minus exports) in the period 2004-06. Experimental data

(see http://www.ecb.europa.eu/stats/intro/html/experiment.en.html for details).6) Deflators for exports and imports refer to goods and services and include cross-border trade within the euro area.

EURO AREASTATISTICS

Prices, output,demand and

labour markets

5.1 HICP, other prices and costs (annual percentage changes, unless otherwise indicated)

S 49ECB

Monthly BulletinMay 2011

4. Unit labour costs, compensation per labour input and labour productivity 1) (seasonally adjusted)

Unit labour costs 2)

Total Total By economic activity

(index:2000 = 100) Agriculture, hunting, Mining, Construction Trade, repairs, hotels and Financial, real estate, Public administration,

forestry and fishing manufacturing restaurants, transport and renting and business education, healthand energy communication services and other services

1 2 3 4 5 6 7 8

2009 120.1 3.8 -2.1 9.3 1.6 5.2 0.9 2.72010 119.5 -0.5 1.4 -5.4 2.3 -0.8 1.7 0.6

2010 Q1 119.9 -0.5 0.6 -6.6 2.6 -0.5 1.2 0.9 Q2 119.6 -0.6 1.3 -6.6 2.5 -1.1 1.9 1.3 Q3 119.3 -0.6 2.7 -4.1 2.5 -1.0 2.2 -0.3 Q4 119.8 -0.2 1.2 -3.5 1.3 -0.4 1.5 0.5

Compensation per employee

2009 123.5 1.5 2.5 0.0 2.3 1.6 1.4 2.62010 125.6 1.7 2.3 3.6 1.6 1.8 1.6 0.7

2010 Q1 124.8 1.7 1.7 3.0 0.8 1.7 1.9 1.1 Q2 125.6 2.1 2.4 4.2 1.7 1.9 1.4 1.4 Q3 125.7 1.5 2.6 3.6 2.0 1.9 1.7 -0.1 Q4 126.4 1.6 2.5 3.5 1.9 1.7 1.4 0.4

Labour productivity per person employed 3)

2009 102.8 -2.3 4.7 -8.5 0.7 -3.4 0.5 -0.22010 105.1 2.2 0.9 9.5 -0.6 2.6 -0.1 0.1

2010 Q1 104.1 2.2 1.1 10.3 -1.8 2.2 0.7 0.2 Q2 105.0 2.6 1.1 11.6 -0.7 3.0 -0.5 0.2 Q3 105.4 2.1 -0.1 8.0 -0.5 3.0 -0.5 0.2 Q4 105.5 1.8 1.3 7.3 0.5 2.1 -0.1 0.0

Compensation per hour worked

2009 127.9 3.1 3.8 4.4 4.7 2.7 2.6 2.82010 129.0 0.9 1.3 0.6 1.5 1.0 1.1 0.5

2010 Q1 128.5 0.9 2.1 0.9 0.4 0.6 1.3 0.8 Q2 129.0 1.0 0.7 0.4 1.5 0.7 1.0 1.2 Q3 128.8 0.5 -0.3 0.2 2.1 1.0 1.1 -0.4 Q4 129.8 1.1 2.6 0.8 2.0 1.7 1.1 0.3

Hourly labour productivity 3)

2009 107.1 -0.9 5.1 -4.7 2.4 -2.5 1.6 0.02010 108.6 1.4 1.2 6.4 -1.1 1.7 -0.6 -0.2

2010 Q1 107.8 1.4 2.2 8.1 -2.5 1.0 -0.1 -0.2 Q2 108.5 1.6 1.3 7.8 -1.4 1.7 -1.0 -0.1 Q3 108.6 1.1 -0.2 4.4 -1.0 1.8 -1.1 -0.1 Q4 109.0 1.3 1.6 4.6 0.6 1.8 -0.2 -0.4

5. Labour cost indices 1), 4)

Total Total By component For selected economic activities Memo item:

(s.a.; index: Indicator2008 = 100) Wages and Employers’ social Mining, Construction Services of

salaries contributions manufacturing negotiatedand energy wages 5)

% of totalin 2008 100.0 100.0 75.2 24.8 32.4 9.0 58.6

1 2 3 4 5 6 7 8

2009 102.8 2.9 2.7 3.4 3.4 3.6 2.5 2.62010 104.3 1.5 1.4 1.8 1.1 1.7 1.6 1.7

2010 Q1 103.8 1.9 1.8 2.1 1.7 2.7 1.8 1.8 Q2 104.2 1.6 1.5 1.8 0.8 1.8 1.9 1.9 Q3 104.3 0.9 0.8 1.3 0.1 1.4 1.3 1.5 Q4 105.0 1.6 1.4 1.9 1.6 1.1 1.6 1.6

Sources: Eurostat, ECB calculations based on Eurostat data (Table 4 in Section 5.1) and ECB calculations (column 8 in Table 5 in Section 5.1).1) Data refer to the Euro 17.2) Compensation (at current prices) per employee divided by labour productivity per person employed.3) Total GDP and value added by economic activity (volumes) per labour input (persons employed and hours worked).4) Hourly labour cost indices for the whole economy, excluding agriculture, public administration, education, health and services not classified elsewhere. Owing to

differences in coverage, the estimates for the components may not be consistent with the total.5) Experimental data (see http://www.ecb.europa.eu/stats/intro/html/experiment.en.html for further details).

5.2 Output and demand

S 50ECBMonthly BulletinMay 2011

1. GDP and expenditure components 1)

Current prices (EUR billions; seasonally adjusted)

GDP

Total Domestic demand External balance 2)

Total Private Government Gross fixed Changes in Total Exports 2) Imports 2)

consumption consumption capital inventories 3)

formation

1 2 3 4 5 6 7 8 9

2007 9,039.0 8,906.1 5,082.6 1,808.9 1,975.1 39.6 132.9 3,745.9 3,613.02008 9,257.0 9,163.5 5,241.3 1,898.8 2,000.5 22.8 93.5 3,872.4 3,778.82009 8,967.1 8,850.2 5,173.7 1,986.3 1,762.9 -72.8 116.9 3,256.7 3,139.82010 9,194.6 9,073.2 5,307.8 2,016.5 1,763.2 -14.3 121.4 3,736.8 3,615.4

2009 Q4 2,251.6 2,209.0 1,299.8 498.1 430.9 -19.7 42.6 840.0 797.42010 Q1 2,265.5 2,236.9 1,310.2 502.0 431.7 -7.1 28.6 874.9 846.3 Q2 2,296.1 2,271.3 1,322.1 504.2 443.5 1.5 24.8 928.2 903.4 Q3 2,313.3 2,279.3 1,330.9 505.5 444.3 -1.5 34.1 955.3 921.2 Q4 2,319.6 2,285.7 1,344.6 504.8 443.6 -7.3 33.9 978.4 944.5

percentage of GDP

2010 100.0 98.7 57.7 21.9 19.2 -0.2 1.3 - -

Chain-linked volumes (prices for the previous year; seasonally adjusted 4) )

quarter-on-quarter percentage changes

2009 Q4 0.2 -0.2 0.3 0.0 -1.1 - - 2.2 1.12010 Q1 0.4 0.6 0.3 -0.1 -0.2 - - 3.1 3.6 Q2 1.0 0.9 0.2 0.2 2.1 - - 4.5 4.2 Q3 0.4 0.1 0.2 0.4 -0.2 - - 2.1 1.5 Q4 0.3 0.0 0.4 0.1 -0.5 - - 1.6 1.0

annual percentage changes

2007 2.9 2.6 1.7 2.2 4.7 - - 6.3 5.82008 0.4 0.4 0.4 2.3 -0.8 - - 0.9 0.82009 -4.1 -3.5 -1.1 2.5 -11.4 - - -13.1 -11.92010 1.8 1.0 0.8 0.7 -0.8 - - 11.2 9.3

2009 Q4 -2.1 -2.7 -0.4 1.9 -9.5 - - -5.3 -6.92010 Q1 0.8 -0.4 0.4 1.1 -4.8 - - 7.0 3.6 Q2 2.0 1.2 0.6 0.6 -0.6 - - 12.9 11.1 Q3 2.0 1.3 1.0 0.5 0.5 - - 12.3 10.9 Q4 2.0 1.5 1.1 0.6 1.1 - - 11.6 10.7

contributions to quarter-on-quarter percentage changes in GDP; percentage points

2009 Q4 0.2 -0.2 0.2 0.0 -0.2 -0.2 0.4 - - 2010 Q1 0.4 0.5 0.2 0.0 0.0 0.4 -0.1 - - Q2 1.0 0.8 0.1 0.0 0.4 0.3 0.2 - - Q3 0.4 0.1 0.1 0.1 0.0 -0.1 0.3 - - Q4 0.3 0.0 0.2 0.0 -0.1 -0.1 0.3 - -

contributions to annual percentage changes in GDP; percentage points

2007 2.8 2.6 1.0 0.5 1.0 0.2 0.2 - - 2008 0.4 0.4 0.2 0.5 -0.2 -0.2 0.1 - - 2009 -4.1 -3.5 -0.6 0.5 -2.5 -0.9 -0.7 - - 2010 1.8 1.0 0.5 0.2 -0.2 0.5 0.8 - -

2009 Q4 -2.1 -2.7 -0.3 0.4 -2.0 -0.8 0.6 - - 2010 Q1 0.8 -0.4 0.3 0.2 -1.0 0.1 1.2 - - Q2 2.0 1.2 0.4 0.1 -0.1 0.8 0.8 - - Q3 2.0 1.3 0.6 0.1 0.1 0.5 0.7 - - Q4 2.0 1.5 0.6 0.1 0.2 0.5 0.5 - -

Sources: Eurostat and ECB calculations.

1) Data refer to the Euro 17.2) Exports and imports cover goods and services and include cross-border intra-euro area trade. They are not fully consistent with: Section 3.1; Table 1 of Section 7.1; Table 3 of Section 7.2; or Tables 1 or 3 of Section 7.5.3) Including acquisitions less disposals of valuables.4) Annual data are not working day-adjusted.

EURO AREASTATISTICS

Prices, output,demand and

labour markets

5.2 Output and demand

S 51ECB

Monthly BulletinMay 2011

2. Value added by economic activity 1)

Current prices (EUR billions; seasonally adjusted)

Gross value added (basic prices) Taxes less

subsidies onTotal Agriculture, Mining, Construction Trade, repairs, Financial, real Public products

hunting, manufacturing hotels and estate, renting administration,forestry and energy restaurants, and business education,

and fishing transport and activities health andactivities communication other services

1 2 3 4 5 6 7 8

2007 8,078.2 152.6 1,653.6 512.9 1,678.3 2,277.1 1,803.7 960.82008 8,310.4 147.9 1,653.5 529.1 1,733.7 2,359.7 1,886.6 946.72009 8,074.4 133.4 1,442.6 507.0 1,670.4 2,357.9 1,963.1 892.62010 8,262.5 143.2 1,527.0 488.5 1,700.5 2,396.8 2,006.5 932.1

2009 Q4 2,026.3 32.9 365.7 123.7 417.9 591.7 494.2 225.42010 Q1 2,041.7 34.6 373.6 121.5 419.0 593.8 499.2 223.8 Q2 2,063.8 35.6 381.7 123.2 424.3 596.2 502.8 232.3 Q3 2,074.1 36.2 382.6 122.4 428.3 602.4 502.1 239.2 Q4 2,083.0 36.7 389.1 121.4 428.9 604.3 502.4 236.7

percentage of value added

2010 100.0 1.7 18.5 5.9 20.6 29.0 24.3 -

Chain-linked volumes (prices for the previous year; seasonally adjusted 2) )

quarter-on-quarter percentage changes

2009 Q4 0.1 -0.2 0.6 -1.8 0.2 -0.1 0.5 1.12010 Q1 0.7 0.8 2.7 -1.6 0.6 0.3 0.3 -2.1 Q2 0.8 -0.5 1.9 1.0 1.1 0.4 0.2 2.8 Q3 0.3 -0.5 0.3 -1.0 0.5 0.6 0.3 0.7 Q4 0.3 1.1 1.1 -1.2 0.0 0.4 0.3 -0.3

annual percentage changes

2007 3.1 1.4 3.2 2.4 3.7 4.0 1.7 0.92008 0.7 1.0 -2.1 -1.3 1.2 1.7 1.9 -1.42009 -4.3 2.3 -13.3 -6.0 -5.1 -1.6 1.2 -3.02010 1.8 0.2 6.1 -4.3 1.9 1.0 1.3 1.4

2009 Q4 -2.3 2.0 -6.7 -5.7 -3.2 -1.2 1.3 -0.12010 Q1 1.0 0.4 4.4 -6.7 0.7 0.3 1.5 -0.4 Q2 2.0 0.3 7.5 -4.1 2.0 0.6 1.3 2.3 Q3 1.9 -0.5 5.6 -3.4 2.4 1.1 1.3 2.5 Q4 2.2 0.8 6.1 -2.9 2.2 1.7 1.1 1.1

contributions to quarter-on-quarter percentage changes in value added; percentage points

2009 Q4 0.1 0.0 0.1 -0.1 0.0 0.0 0.1 - 2010 Q1 0.7 0.0 0.5 -0.1 0.1 0.1 0.1 - Q2 0.8 0.0 0.4 0.1 0.2 0.1 0.1 - Q3 0.3 0.0 0.0 -0.1 0.1 0.2 0.1 - Q4 0.3 0.0 0.2 -0.1 0.0 0.1 0.1 -

contributions to annual percentage changes in value added; percentage points

2007 3.1 0.0 0.7 0.2 0.8 1.1 0.4 - 2008 0.7 0.0 -0.4 -0.1 0.3 0.5 0.4 - 2009 -4.3 0.0 -2.7 -0.4 -1.1 -0.5 0.3 - 2010 1.8 0.0 1.1 -0.3 0.4 0.3 0.3 -

2009 Q4 -2.3 0.0 -1.3 -0.4 -0.7 -0.3 0.3 - 2010 Q1 1.0 0.0 0.8 -0.4 0.2 0.1 0.4 - Q2 2.0 0.0 1.3 -0.3 0.4 0.2 0.3 - Q3 1.9 0.0 1.0 -0.2 0.5 0.3 0.3 - Q4 2.2 0.0 1.1 -0.2 0.5 0.5 0.3 -

Sources: Eurostat and ECB calculations.

1) Data refer to the Euro 17.2) Annual data are not working day-adjusted.

5.2 Output and demand (annual percentage changes, unless otherwise indicated)

S 52ECBMonthly BulletinMay 2011

3. Industrial production

Total Industry excluding construction Construction

Total Total Industry excluding construction and energy Energy

(s.a.; index: 2005 = 100) Manu- Total Intermediate Capital Consumer goods

facturing goods goodsTotal Durable Non-durable

% of totalin 2005 100.0 77.8 77.8 69.2 68.7 28.1 22.3 18.3 2.6 15.7 9.1 22.2

1 2 3 4 5 6 7 8 9 10 11 12

2008 -2.5 106.5 -1.7 -1.8 -1.9 -3.4 0.0 -2.0 -5.3 -1.5 0.2 -5.52009 -13.7 90.8 -14.7 -15.8 -15.9 -19.0 -20.7 -4.9 -17.3 -2.9 -5.4 -8.32010 4.3 97.6 7.5 7.9 8.0 10.0 9.4 3.7 2.5 3.8 3.7 -7.7

2010 Q1 2.2 95.0 5.3 5.5 5.5 8.8 3.2 3.7 0.0 4.2 3.5 -10.0 Q2 6.5 97.2 9.5 9.7 9.9 14.3 9.6 4.3 4.9 4.2 5.5 -4.0 Q3 3.9 98.2 7.2 7.8 7.9 9.3 10.1 3.5 3.7 3.4 1.4 -8.1 Q4 4.6 100.1 8.1 8.6 8.6 7.8 14.2 3.3 1.7 3.4 4.5 -9.0

2010 Sep. 2.7 98.2 5.7 6.2 6.2 7.3 8.6 1.9 0.8 2.0 0.8 -7.9 Oct. 4.3 99.0 7.2 7.8 8.0 7.4 12.7 3.3 1.9 3.5 1.3 -6.4 Nov. 4.9 100.5 8.2 8.5 8.5 8.0 13.0 3.9 0.9 4.2 5.6 -7.3 Dec. 4.6 100.7 8.9 9.5 9.5 8.0 17.0 2.5 2.4 2.5 6.1 -13.9

2011 Jan. 4.2 100.9 6.3 8.2 8.2 10.2 12.6 0.8 2.6 0.5 -2.5 -3.9 Feb. 6.6 101.4 7.5 9.3 9.3 10.1 14.1 2.8 4.2 2.5 -2.7 3.8

month-on-month percentage changes (s.a.)

2010 Sep. -0.4 - -0.7 -1.0 -0.3 -1.1 -1.0 -0.8 -2.3 -0.5 -1.3 -1.5 Oct. 0.7 - 0.8 1.1 1.1 0.3 1.8 0.4 0.1 0.4 1.2 0.5 Nov. 1.0 - 1.5 1.5 0.7 2.0 1.7 0.7 0.8 0.7 1.9 -1.1 Dec. -0.3 - 0.2 1.0 1.3 -1.0 1.5 -0.2 -0.7 -0.3 2.6 -3.0

2011 Jan. 0.7 - 0.2 0.7 0.2 2.7 -0.2 -0.3 1.8 -0.4 -3.7 4.0 Feb. 0.9 - 0.5 1.1 1.1 0.4 1.0 1.0 0.3 1.0 -0.1 -0.9

4. Industrial new orders and turnover, retail sales and new passenger car registrations

Industrial new orders Industrial turnover Retail sales (excluding automotive fuel) New passenger car

registrations Manufacturing 1) Manufacturing Current prices Constant prices (current prices) (current prices)

Total Total Total Total Total Total Total Food, Non-food Total (s.a.; Total

(s.a.; index: (s.a.; index: (s.a.; index: beverages, thousands) 2)

2005 = 100) 2005 = 100) 2005 = 100) tobacco Textiles, Householdclothing, equipmentfootwear

% of totalin 2005 100.0 100.0 100.0 100.0 100.0 100.0 100.0 43.0 57.0 10.1 14.3

1 2 3 4 5 6 7 8 9 10 11 12 13

2008 113.0 -5.4 116.7 1.8 1.7 103.4 -0.8 -1.8 -0.1 -1.8 -1.6 891 -7.82009 87.5 -22.8 95.4 -18.4 -2.9 101.4 -2.0 -1.7 -2.2 -1.8 -3.9 925 3.32010 102.9 17.5 105.1 10.2 1.4 102.5 1.1 0.5 1.7 2.6 0.6 843 -8.6

2010 Q2 102.4 22.5 104.2 12.2 1.3 102.4 1.0 0.2 1.6 -0.3 2.0 836 -13.1 Q3 105.8 15.9 106.2 10.1 2.1 102.8 1.7 0.4 2.9 5.5 1.1 797 -16.4 Q4 108.5 17.9 109.5 12.2 1.5 102.6 1.0 0.2 1.5 1.7 -0.3 851 -11.12011 Q1 . . . . 1.1 102.7 0.3 -1.2 1.3 . . 867 -3.1

2010 Oct. 106.1 14.7 108.0 8.4 2.0 102.9 1.6 0.4 2.3 2.3 1.1 829 -15.3 Nov. 108.3 19.9 109.0 14.0 1.8 102.6 1.3 0.8 1.9 3.6 0.3 876 -10.0 Dec. 111.1 19.0 111.6 14.2 0.7 102.4 0.2 -0.4 0.6 -0.3 -1.9 849 -6.9

2011 Jan. 112.3 21.9 114.2 15.9 1.4 102.8 0.9 -1.0 1.9 -0.9 4.4 850 -4.3 Feb. 113.4 21.5 115.6 16.0 2.1 103.1 1.6 -0.3 2.9 4.4 4.1 875 0.1 Mar. . . . . -0.2 102.2 -1.3 -2.1 -0.8 . . 875 -4.5

month-on-month percentage changes (s.a.)

2010 Nov. - 2.1 - 1.0 -0.3 - -0.2 -0.1 -0.3 -0.6 -0.3 - 5.6 Dec. - 2.6 - 2.4 -0.2 - -0.3 -0.3 -0.2 -0.7 -0.6 - -3.0

2011 Jan. - 1.1 - 2.4 0.6 - 0.4 -0.1 0.6 0.6 2.3 - 0.1 Feb. - 1.0 - 1.2 0.3 - 0.3 0.1 0.5 2.1 0.1 - 2.9 Mar. - . - . -0.5 - -0.9 -0.6 -1.1 . . - 0.0

Sources: Eurostat, except columns 12 and 13 in Table 4 in Section 5.2 (which comprise ECB calculations based on data from the European Automobile Manufacturers’ Association).1) Includes manufacturing industries working mainly on the basis of orders, which represented 61.2% of total manufacturing in 2005.2) Annual and quarterly figures are averages of monthly figures in the period concerned.

EURO AREASTATISTICS

Prices, output,demand and

labour markets

5.2 Output and demand (percentage balances, 1) unless otherwise indicated; seasonally adjusted)

S 53ECB

Monthly BulletinMay 2011

5. Business and Consumer Surveys

Economic Manufacturing industry Consumer confidence indicatorsentiment

indicator 2) Industrial confidence indicator Capacity Total 4) Financial Economic Unemployment Savings(long-term utilisation 3) situation situation situation over next

average Total 4) Order Stocks of Production (%) over next over next over next 12 months= 100) books finished expectations 12 months 12 months 12 months

products

1 2 3 4 5 6 7 8 9 10 11

2007 109.4 5.8 7.2 4.4 14.6 84.8 -4.9 -2.3 -4.3 5.0 -8.02008 93.7 -8.4 -13.3 10.8 -1.0 82.1 -18.1 -9.9 -25.3 23.5 -13.62009 80.7 -28.7 -56.8 14.6 -14.8 70.9 -24.8 -7.0 -26.3 55.5 -10.32010 100.9 -4.6 -24.4 0.6 11.3 77.0 -14.0 -5.2 -12.2 31.0 -7.6

2010 Q1 96.4 -12.0 -41.5 2.4 8.1 74.2 -16.8 -3.7 -10.9 45.9 -6.8 Q2 99.1 -6.4 -28.6 0.5 10.1 76.7 -16.7 -6.2 -17.8 33.8 -8.9 Q3 102.3 -2.5 -18.0 0.3 10.9 77.8 -12.1 -5.5 -11.3 23.4 -8.2 Q4 105.6 2.5 -9.4 -0.8 16.2 79.3 -10.4 -5.4 -8.7 20.9 -6.62011 Q1 107.3 6.5 -1.3 -1.9 18.8 80.8 -10.6 -6.0 -9.6 19.7 -7.0

2010 Nov. 105.6 1.8 -10.6 -0.8 15.2 - -9.4 -5.0 -6.7 19.8 -6.1 Dec. 106.9 5.1 -5.3 -2.0 18.7 - -11.0 -5.8 -9.2 21.3 -7.7

2011 Jan. 106.8 6.1 -2.7 -1.9 18.9 80.3 -11.2 -6.6 -10.1 19.9 -8.2 Feb. 107.9 6.6 -1.3 -1.5 19.7 - -10.0 -5.2 -8.6 20.2 -5.8 Mar. 107.3 6.7 0.0 -2.3 17.9 - -10.6 -6.3 -10.2 19.0 -7.1 Apr. 106.2 5.8 0.2 -1.4 15.7 81.3 -11.6 -7.3 -14.4 16.6 -8.1

Construction confidence indicator Retail trade confidence indicator Services confidence indicator

Total 4) Order Employment Total 4) Present Volume of Expected Total 4) Business Demand in Demand inbooks expectations business stocks business climate recent the months

situation situation months ahead

12 13 14 15 16 17 18 19 20 21 22

2007 0.1 -7.6 7.8 1.1 5.1 13.2 11.4 16.1 13.3 14.6 20.42008 -13.4 -20.7 -6.1 -10.0 -10.6 16.0 -3.5 0.6 -3.7 0.7 4.72009 -32.7 -42.2 -23.2 -15.5 -21.0 9.9 -15.7 -15.5 -20.4 -17.9 -8.32010 -28.4 -39.6 -17.2 -4.0 -6.1 7.4 1.5 5.0 2.5 4.2 8.3

2010 Q1 -30.2 -41.3 -19.2 -8.9 -13.4 7.8 -5.5 0.0 -3.3 -3.0 6.3 Q2 -29.2 -41.3 -17.1 -5.1 -7.5 7.5 -0.5 3.9 1.6 2.8 7.3 Q3 -28.1 -39.8 -16.4 -2.8 -4.7 7.0 3.4 6.9 4.8 8.3 7.6 Q4 -26.2 -36.0 -16.3 0.8 1.3 7.4 8.5 9.0 6.8 8.4 11.92011 Q1 -25.2 -36.1 -14.3 -0.7 0.1 8.2 6.0 10.6 8.3 10.5 13.2

2010 Nov. -26.5 -36.2 -16.7 -1.1 -3.2 7.6 7.6 9.3 6.8 9.4 11.6 Dec. -26.7 -36.7 -16.8 4.3 7.3 5.9 11.4 9.8 8.2 9.1 12.1

2011 Jan. -26.0 -38.9 -13.1 -0.6 0.4 6.7 4.6 9.9 8.4 9.1 12.1 Feb. -24.2 -34.0 -14.4 -0.2 0.7 7.2 6.0 11.2 8.8 12.1 12.9 Mar. -25.4 -35.4 -15.3 -1.4 -0.8 10.6 7.3 10.8 7.6 10.2 14.7 Apr. -24.2 -33.3 -15.2 -1.8 -1.8 9.0 5.4 10.4 7.9 10.0 13.4

Source: European Commission (Economic and Financial Affairs DG).1) Difference between the percentages of respondents giving positive and negative replies.2) The economic sentiment indicator is composed of the industrial, services, consumer, construction and retail trade confidence indicators; the industrial confidence indicator has

a weight of 40%, the services confidence indicator a weight of 30%, the consumer confidence indicator a weight of 20% and the two other indicators a weight of 5% each.Values for the economic sentiment indicator of above (below) 100 indicate above-average (below-average) economic sentiment, calculated for the period 1990 to 2010.

3) Data are collected in January, April, July and October each year. The quarterly figures shown are averages of two successive surveys. Annual data are derived from quarterly averages.

4) The confidence indicators are calculated as simple averages of the components shown; the assessments of stocks (columns 4 and 17) and unemployment (column 10) are used with inverted signs for the calculation of confidence indicators.

5.3 Labour markets 1), 2) (annual percentage changes, unless otherwise indicated; seasonally adjusted)

S 54ECBMonthly BulletinMay 2011

1. Employment in terms of persons employed

Whole economy By employment status By economic activity

Total Total Employees Self- Agriculture, Mining, Construction Trade, repairs, Financial, real Public(millions) employed hunting, manufacturing hotels and estate, renting administration,

forestry and energy restaurants, and business education, healthand fishing transport and services and other services

communication

% of totalin 2010 100.0 100.0 85.5 14.5 3.8 16.0 6.9 25.5 16.3 31.5

1 2 3 4 5 6 7 8 9 10

2008 148.606 0.8 1.0 -0.3 -1.8 -0.1 -2.0 1.2 2.2 1.22009 145.809 -1.9 -1.8 -2.4 -2.4 -5.3 -6.7 -1.8 -2.1 1.42010 145.131 -0.5 -0.4 -0.7 -0.6 -3.1 -3.7 -0.7 1.0 1.2

2010 Q1 144.957 -1.3 -1.4 -0.6 -0.8 -5.4 -5.0 -1.5 -0.4 1.3 Q2 145.128 -0.6 -0.6 -0.9 -0.8 -3.6 -3.4 -1.0 1.1 1.1 Q3 145.102 -0.2 0.0 -0.9 -0.4 -2.3 -2.9 -0.6 1.6 1.1 Q4 145.336 0.2 0.4 -0.6 -0.6 -1.1 -3.4 0.2 1.8 1.1

quarter-on-quarter percentage changes

2010 Q1 -0.023 0.0 -0.1 0.2 0.0 -0.7 -1.1 -0.1 0.4 0.5 Q2 0.170 0.1 0.3 -0.7 -1.0 -0.1 -0.3 0.0 0.9 0.2 Q3 -0.025 0.0 0.0 -0.4 0.1 -0.3 -1.1 0.1 0.2 0.2 Q4 0.233 0.2 0.1 0.3 0.4 0.0 -0.9 0.3 0.3 0.3

2. Employment in terms of hours worked

Whole economy By employment status By economic activity

Total Total Employees Self- Agriculture, Mining, Construction Trade, repairs, Financial, real Public(millions) employed hunting, manufacturing hotels and estate, renting administration,

forestry and energy restaurants, and business education, healthand fishing transport and services and other services

communication

% of totalin 2010 100.0 100.0 80.5 19.5 4.9 16.0 7.8 27.0 15.9 28.5

1 2 3 4 5 6 7 8 9 10

2008 239,799.3 0.6 0.9 -1.0 -2.3 -0.7 -1.7 0.7 2.3 1.42009 231,891.6 -3.3 -3.4 -2.9 -2.7 -9.0 -8.3 -2.7 -3.2 1.22010 232,731.8 0.4 0.4 0.2 -1.0 -0.3 -3.2 0.2 1.5 1.5

2010 Q1 57,954.4 -0.5 -0.7 0.1 -1.8 -3.4 -4.3 -0.3 0.4 1.7 Q2 58,177.8 0.4 0.5 0.0 -1.0 -0.2 -2.8 0.2 1.6 1.3 Q3 58,303.2 0.8 1.0 0.3 -0.3 1.2 -2.4 0.5 2.2 1.3 Q4 58,296.3 0.8 0.9 0.2 -0.8 1.5 -3.4 0.4 1.9 1.5

quarter-on-quarter percentage changes

2010 Q1 99.7 0.2 0.2 0.2 -0.7 -0.1 -0.9 0.2 0.4 0.6 Q2 223.4 0.4 0.5 -0.1 0.1 0.8 0.0 0.3 0.7 0.2 Q3 125.4 0.2 0.3 -0.2 -0.1 0.7 -0.9 0.0 0.5 0.4 Q4 -7.0 0.0 -0.1 0.2 -0.1 0.1 -1.6 -0.1 0.3 0.3

3. Hours worked per person employed

Whole economy By employment status By economic activity

Total Total Employees Self- Agriculture, Mining, Construction Trade, repairs, Financial, real Public(thousands) employed hunting, manufacturing hotels and estate, renting administration,

forestry and energy restaurants, and business education, healthand fishing transport and services and other services

communication

1 2 3 4 5 6 7 8 9 10

2008 1.614 -0.2 0.0 -0.7 -0.5 -0.6 0.4 -0.4 0.1 0.22009 1.590 -1.4 -1.6 -0.5 -0.4 -4.0 -1.7 -1.0 -1.1 -0.22010 1.604 0.8 0.8 0.9 -0.3 2.9 0.5 0.9 0.5 0.3

2010 Q1 0.400 0.8 0.8 0.7 -1.0 2.1 0.8 1.2 0.8 0.4 Q2 0.401 1.0 1.0 0.9 -0.2 3.5 0.7 1.2 0.5 0.2 Q3 0.402 1.0 1.0 1.2 0.1 3.5 0.5 1.1 0.6 0.3 Q4 0.401 0.5 0.5 0.8 -0.2 2.6 -0.1 0.3 0.1 0.3

Source: ECB calculations based on Eurostat data.1) Data for employment are based on the ESA 95.2) Data refer to the Euro 17.

EURO AREASTATISTICS

Prices, output,demand and

labour markets

5.3 Labour markets (seasonally adjusted, unless otherwise indicated)

S 55ECB

Monthly BulletinMay 2011

4. Unemployment and job vacancies 1)

Unemployment Job vacancy

rate 2), 3)

Total By age 4) By gender 5)

Millions % of labour Adult Youth Male Femaleforce

Millions % of labour Millions % of labour Millions % of labour Millions % of labour % of totalforce force force force posts

% of totalin 2010 100.0 79.6 20.4 53.8 46.2

1 2 3 4 5 6 7 8 9 10 11

2007 11.765 7.6 9.193 6.7 2.572 15.4 5.794 6.7 5.972 8.7 . 2008 11.977 7.6 9.313 6.7 2.664 16.0 6.043 7.0 5.934 8.5 . 2009 14.977 9.5 11.730 8.3 3.247 20.0 8.070 9.3 6.908 9.8 1.42010 15.890 10.1 12.647 8.9 3.243 20.7 8.554 9.9 7.335 10.3 1.5

2010 Q1 15.834 10.1 12.516 8.9 3.318 20.9 8.585 10.0 7.249 10.2 1.4 Q2 15.969 10.2 12.677 9.0 3.292 20.9 8.633 10.0 7.336 10.3 1.5 Q3 15.933 10.1 12.726 9.0 3.207 20.6 8.548 9.9 7.385 10.4 1.4 Q4 15.822 10.1 12.669 8.9 3.154 20.4 8.451 9.8 7.371 10.4 1.62011 Q1 15.618 9.9 12.555 8.8 3.062 19.9 8.307 9.7 7.311 10.3 .

2010 Oct. 15.949 10.1 12.767 9.0 3.182 20.5 8.541 9.9 7.408 10.4 - Nov. 15.817 10.1 12.654 8.9 3.164 20.4 8.440 9.8 7.377 10.4 - Dec. 15.700 10.0 12.585 8.9 3.115 20.2 8.372 9.7 7.329 10.3 -

2011 Jan. 15.652 10.0 12.563 8.9 3.089 20.1 8.325 9.7 7.327 10.3 - Feb. 15.605 9.9 12.549 8.8 3.056 19.9 8.304 9.7 7.301 10.2 - Mar. 15.596 9.9 12.554 8.8 3.042 19.8 8.291 9.6 7.305 10.2 -

C28 Employment - persons employed and hours worked 2)

(annual percentage changes)

C29 Unemployment and job vacancy 2), 3) rates

-4.0

-3.0

-2.0

-1.0

0.0

1.0

2.0

3.0

2002 2003 2004 2005 2006 2007 2008 2009 2010-4.0

-3.0

-2.0

-1.0

0.0

1.0

2.0

3.0

employment in terms of persons employedemployment in terms of hours worked

7.0

7.5

8.0

8.5

9.0

9.5

10.0

10.5

2006 2007 2008 2009 20100.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

unemployment rate (left-hand scale)job vacancy rate (right-hand scale)

Source: Eurostat.1) Data for unemployment refer to persons and follow ILO recommendations.2) Data refer to the Euro 17.3) Industry, construction and services (excluding households as employers and extra-territorial organisations and bodies); non-seasonally adjusted.4) Adult: 25 years of age and over; youth: below 25 years of age; rates are expressed as a percentage of the labour force for the relevant age group.5) Rates are expressed as a percentage of the labour force for the relevant gender.

6 GOVERNMENT FINANCE

6.1 Revenue, expenditure and deficit/surplus 1) (as a percentage of GDP)

S 56ECBMonthly BulletinMay 2011

1. Euro area _ revenue

Total Current revenue Capital revenue Memo

item:Direct Indirect Social Sales Capital Fiscaltaxes Households Corporations taxes Received by EU contributions Employers Employees taxes burden 2)

institutions1 2 3 4 5 6 7 8 9 10 11 12 13 14

2002 45.1 44.8 11.8 9.2 2.5 13.5 0.4 15.6 8.1 4.6 2.1 0.3 0.3 41.12003 45.0 44.3 11.4 9.0 2.3 13.5 0.4 15.7 8.2 4.6 2.1 0.6 0.5 41.12004 44.5 44.0 11.3 8.7 2.5 13.5 0.3 15.5 8.1 4.5 2.1 0.5 0.4 40.72005 44.8 44.3 11.5 8.7 2.7 13.7 0.3 15.4 8.1 4.5 2.2 0.5 0.3 40.92006 45.3 45.0 12.1 8.9 3.0 13.8 0.3 15.3 8.0 4.4 2.1 0.3 0.3 41.42007 45.4 45.1 12.4 9.1 3.2 13.8 0.3 15.1 8.0 4.4 2.1 0.3 0.3 41.52008 45.0 44.8 12.2 9.3 2.8 13.3 0.3 15.3 8.1 4.5 2.2 0.2 0.2 41.02009 44.6 44.2 11.4 9.3 1.9 13.1 0.3 15.7 8.2 4.5 2.3 0.3 0.4 40.52010 44.5 44.2 11.3 9.1 2.1 13.2 0.2 15.6 8.1 4.5 2.3 0.3 0.3 40.4

2. Euro area _ expenditure

Total Current expenditure Capital expenditure Memo

item:Total Compensation Intermediate Interest Current Investment Capital Primary

of consumption transfers Social Subsidies transfers Paid by EU expenditure 3)

employees payments Paid by EU institutionsinstitutions

1 2 3 4 5 6 7 8 9 10 11 12 13 14

2002 47.7 43.9 10.4 4.9 3.5 25.1 22.2 1.9 0.5 3.8 2.4 1.4 0.1 44.22003 48.0 44.1 10.5 5.0 3.3 25.3 22.5 1.9 0.5 3.9 2.5 1.4 0.1 44.72004 47.4 43.5 10.4 5.0 3.1 25.0 22.3 1.7 0.5 3.9 2.5 1.5 0.1 44.32005 47.3 43.4 10.4 5.1 3.0 25.0 22.2 1.7 0.5 3.9 2.5 1.4 0.0 44.32006 46.7 42.8 10.2 5.0 2.9 24.7 22.0 1.7 0.5 3.8 2.5 1.4 0.0 43.82007 46.0 42.2 10.0 5.0 3.0 24.3 21.5 1.6 0.4 3.8 2.6 1.2 0.0 43.12008 47.0 43.2 10.1 5.2 3.0 24.9 22.0 1.6 0.4 3.9 2.6 1.3 0.0 44.02009 50.9 46.6 10.8 5.6 2.8 27.4 24.2 1.8 0.5 4.2 2.8 1.4 0.0 48.12010 50.5 46.3 10.6 5.6 2.8 27.4 24.2 1.8 0.4 4.1 2.5 1.7 0.0 47.7

3. Euro area _ deficit/surplus, primary deficit/surplus and government consumption

Deficit (-)/surplus (+) Primary Government consumption 4)

deficit (-)/ Total Central State Local Social surplus (+) Total Collective Individual

gov. gov. gov. security Compensation Intermediate Transfers Consumption Sales consumption consumptionfunds of employees consumption in kind of fixed (minus)

via market capitalproducers

1 2 3 4 5 6 7 8 9 10 11 12 13 14

2002 -2.6 -2.1 -0.5 -0.2 0.2 0.9 20.2 10.4 4.9 5.1 1.8 2.1 8.3 12.02003 -3.1 -2.4 -0.5 -0.2 0.0 0.2 20.5 10.5 5.0 5.2 1.9 2.1 8.3 12.22004 -3.0 -2.5 -0.4 -0.3 0.1 0.2 20.4 10.4 5.0 5.1 1.9 2.1 8.3 12.12005 -2.5 -2.2 -0.3 -0.2 0.2 0.4 20.4 10.4 5.1 5.1 1.9 2.2 8.2 12.22006 -1.4 -1.5 -0.1 -0.2 0.4 1.5 20.3 10.2 5.0 5.2 1.9 2.1 8.1 12.22007 -0.7 -1.2 0.0 -0.1 0.6 2.3 20.0 10.0 5.0 5.1 1.9 2.1 7.9 12.12008 -2.0 -2.1 -0.2 -0.2 0.5 1.0 20.5 10.1 5.2 5.3 2.0 2.2 8.1 12.42009 -6.3 -5.2 -0.5 -0.3 -0.4 -3.5 22.1 10.8 5.6 5.8 2.1 2.3 8.7 13.32010 -6.0 -4.9 -0.6 -0.4 -0.1 -3.2 21.9 10.6 5.6 5.8 2.0 2.3 8.6 13.2

4. Euro area countries _ deficit (-)/surplus (+) 5)

BE DE EE IE GR ES FR IT CY LU MT NL AT PT SI SK FI1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17

2007 -0.3 0.3 2.5 0.1 -6.4 1.9 -2.7 -1.5 3.4 3.7 -2.4 0.2 -0.9 -3.1 -0.1 -1.8 5.22008 -1.3 0.1 -2.8 -7.3 -9.8 -4.2 -3.3 -2.7 0.9 3.0 -4.5 0.6 -0.9 -3.5 -1.8 -2.1 4.22009 -5.9 -3.0 -1.7 -14.3 -15.4 -11.1 -7.5 -5.4 -6.0 -0.9 -3.7 -5.5 -4.1 -10.1 -6.0 -8.0 -2.62010 -4.1 -3.3 0.1 -32.4 -10.5 -9.2 -7.0 -4.6 -5.3 -1.7 -3.6 -5.4 -4.6 -9.1 -5.6 -7.9 -2.5

Sources: ECB for euro area aggregated data; European Commission for data relating to countries’ deficit/surplus.1) Data refer to the Euro 17. The concepts "revenue", "expenditure" and "deficit/surplus" are based on the ESA 95. Transactions involving the EU budget are included and

consolidated. Transactions among Member States’ governments are not consolidated.2) The fiscal burden comprises taxes and social contributions.3) Comprises total expenditure minus interest expenditure.4) Corresponds to final consumption expenditure (P.3) of general government in the ESA 95.5) Includes proceeds from the sale of UMTS licences and settlements under swaps and forward rate agreements.

EURO AREASTATISTICS

Governmentfinance

6.2 Debt 1) (as a percentage of GDP)

S 57ECB

Monthly BulletinMay 2011

1. Euro area _ by financial instrument and sector of the holder

Total Financial instruments Holders

Currency Loans Short-term Long-term Domestic creditors 2) Other

and securities securities creditors 3)

deposits Total MFIs Other Otherfinancial sectors

corporations

1 2 3 4 5 6 7 8 9 10

2001 68.1 2.8 12.4 4.0 48.9 42.4 20.8 11.2 10.4 25.72002 67.9 2.7 11.8 4.6 48.8 41.0 19.6 10.8 10.6 26.92003 69.0 2.0 12.4 5.0 49.5 40.2 19.8 11.2 9.1 28.82004 69.4 2.2 12.0 5.0 50.3 39.0 18.9 11.1 9.1 30.42005 70.2 2.4 12.1 4.7 51.0 37.3 18.1 11.2 8.0 32.92006 68.5 2.4 11.8 4.1 50.1 35.4 18.4 9.3 7.7 33.12007 66.2 2.2 11.2 4.2 48.7 33.1 17.1 8.6 7.4 33.12008 69.9 2.3 11.4 6.7 49.5 33.0 17.8 7.8 7.4 36.82009 79.3 2.4 12.4 8.5 55.9 37.0 20.5 8.9 7.6 42.32010 85.2 2.4 15.4 7.7 59.6 40.8 24.0 10.1 6.7 44.3

2. Euro area _ by issuer, maturity and currency denomination

Total Issued by: 4) Original maturity Residual maturity Currencies

Central State Local Social Up to Over Up to Over 1 and Over Euro or Other

gov. gov. gov. security 1 year 1 year Variable 1 year up to 5 years 5 years participating currenciesfunds interest rate currencies

1 2 3 4 5 6 7 8 9 10 11 12 13

2001 68.1 57.0 6.0 4.7 0.4 7.0 61.1 5.3 13.7 26.5 27.9 66.7 1.42002 67.9 56.6 6.2 4.7 0.4 7.6 60.3 5.2 15.5 25.2 27.2 66.7 1.22003 69.0 56.9 6.5 5.1 0.6 7.8 61.2 5.0 14.8 26.0 28.2 68.1 0.92004 69.4 57.3 6.6 5.1 0.4 7.8 61.6 4.6 14.8 26.2 28.4 68.6 0.82005 70.2 57.8 6.7 5.2 0.5 7.9 62.3 4.6 14.8 25.6 29.7 69.2 1.02006 68.5 56.1 6.5 5.3 0.5 7.4 61.0 4.3 14.4 24.1 30.0 67.9 0.52007 66.2 53.5 6.2 5.2 1.3 7.1 59.1 4.3 15.0 23.4 27.8 65.8 0.42008 69.9 56.8 6.6 5.2 1.3 9.9 60.0 4.9 18.6 23.0 28.2 69.2 0.72009 79.3 64.4 7.6 5.7 1.7 11.7 67.6 5.0 20.9 26.6 31.8 78.5 0.82010 85.2 69.3 8.2 5.7 1.9 12.8 72.3 5.4 22.2 28.6 34.3 84.4 0.8

3. Euro area countries

BE DE EE IE GR ES FR IT CY LU MT NL AT PT SI SK FI

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17

2007 84.2 64.9 3.7 25.0 105.4 36.1 63.9 103.6 58.3 6.7 62.0 45.3 60.7 68.3 23.1 29.6 35.22008 89.6 66.3 4.6 44.4 110.7 39.8 67.7 106.3 48.3 13.6 61.5 58.2 63.8 71.6 21.9 27.8 34.12009 96.2 73.5 7.2 65.6 127.1 53.3 78.3 116.1 58.0 14.6 67.6 60.8 69.6 83.0 35.2 35.4 43.82010 96.8 83.2 6.6 96.2 142.8 60.1 81.7 119.0 60.8 18.4 68.0 62.7 72.3 93.0 38.0 41.0 48.4

Sources: ECB for euro area aggregated data; European Commission for data relating to countries’ debt.1) Data refer to the Euro 17. Gross general government debt at nominal value and consolidated between sub-sectors of government. Holdings by non-resident governments are

not consolidated. Intergovernmental lending in the context of the financial crisis is consolidated. Data are partially estimated.2) Holders resident in the country whose government has issued the debt. 3) Includes residents of euro area countries other than the country whose government has issued the debt. 4) Excludes debt held by general government in the country whose government has issued it.

6.3 Change in debt 1) (as a percentage of GDP)

S 58ECBMonthly BulletinMay 2011

1. Euro area _ by source, financial instrument and sector of the holder

Total Source of change Financial instruments Holders

Borrowing Valuation Other Currency Loans Short-term Long-term Domestic Other

requirement 2) effects 3) changes and securities securities creditors 5) MFIs Other creditors 6)

in deposits financialvolume 4) corporations

1 2 3 4 5 6 7 8 9 10 11 12

2002 2.1 2.7 -0.5 -0.1 0.0 -0.2 0.7 1.6 0.0 -0.5 0.0 2.12003 3.1 3.3 -0.2 0.0 -0.6 0.9 0.6 2.1 0.4 0.8 0.8 2.72004 3.1 3.2 -0.1 0.0 0.2 0.1 0.1 2.7 0.4 -0.2 0.3 2.72005 3.3 3.0 0.2 0.0 0.3 0.5 -0.1 2.6 -0.3 -0.1 0.5 3.62006 1.7 1.4 0.1 0.1 0.2 0.3 -0.3 1.5 -0.1 1.1 -1.3 1.82007 1.2 1.1 0.0 0.0 -0.1 0.0 0.3 1.1 -0.5 -0.3 -0.2 1.72008 5.2 5.1 0.1 0.0 0.1 0.5 2.6 2.0 0.7 1.1 -0.5 4.52009 7.2 7.4 -0.2 0.0 0.1 0.7 1.6 4.8 2.9 2.2 0.8 4.32010 7.8 7.9 -0.1 0.0 0.0 3.3 -0.6 5.1 4.7 4.0 1.5 3.1

2. Euro area _ deficit-debt adjustment

Change in Deficit (-) / Deficit-debt adjustment 8)

debt surplus (+) 7) Total Transactions in main financial assets held by general government Valuation Other Other 9)

effects Exchange changes inTotal Currency Loans Securities 10) Shares and rate volume

and other Privatisations Equity effectsdeposits equity injections

1 2 3 4 5 6 7 8 9 10 11 12 13 14

2002 2.1 -2.6 -0.5 0.1 0.1 0.0 0.1 -0.1 -0.4 0.1 -0.5 -0.1 -0.1 0.02003 3.1 -3.1 0.0 0.1 0.1 0.0 0.0 0.1 -0.2 0.1 -0.2 -0.1 0.0 0.12004 3.1 -3.0 0.2 0.2 0.2 0.0 0.1 0.0 -0.5 0.2 -0.1 0.0 0.0 0.12005 3.3 -2.5 0.7 0.6 0.3 0.1 0.1 0.1 -0.3 0.2 0.2 0.0 0.0 -0.12006 1.7 -1.4 0.3 0.3 0.3 -0.1 0.3 -0.2 -0.4 0.1 0.1 0.0 0.1 -0.32007 1.2 -0.7 0.5 0.6 0.2 0.0 0.2 0.1 -0.3 0.2 0.0 0.0 0.0 -0.12008 5.2 -2.0 3.2 3.0 0.8 0.7 0.7 0.9 -0.1 0.6 0.1 0.0 0.0 0.02009 7.2 -6.3 0.9 1.1 0.4 0.0 0.3 0.5 -0.3 0.5 -0.2 0.0 0.0 0.02010 7.8 -6.0 1.9 2.4 0.3 0.5 1.3 0.2 0.0 0.1 -0.1 0.0 0.0 -0.4

Source: ECB.1) Data refer to the Euro 17 and are partially estimated. Annual change in gross nominal consolidated debt is expressed as a percentage of GDP, i.e. [debt(t) - debt(t-1)] ÷ GDP(t). Intergovernmental lending in the context of the financial crisis is consolidated.2) The borrowing requirement is by definition equal to transactions in debt.3) Includes, in addition to the impact of foreign exchange movements, effects arising from measurement at nominal value (e.g. premia or discounts on securities issued).4) Includes, in particular, the impact of the reclassification of units and certain types of debt assumption.5) Holders resident in the country whose government has issued the debt. 6) Includes residents of euro area countries other than the country whose government has issued the debt. 7) Including proceeds from sales of UMTS licences.8) The difference between the annual change in gross nominal consolidated debt and the deficit as a percentage of GDP. 9) Mainly composed of transactions in other assets and liabilities (trade credits, other receivables/payables and financial derivatives).10) Excluding financial derivatives.

EURO AREASTATISTICS

Governmentfinance

6.4 Quarterly revenue, expenditure and deficit/surplus 1) (as a percentage of GDP)

S 59ECB

Monthly BulletinMay 2011

1. Euro area _ quarterly revenue

Total Current revenue Capital revenue Memo

item:Direct taxes Indirect taxes Social Sales Property Capital Fiscal

contributions income taxes burden 2)

1 2 3 4 5 6 7 8 9 10

2004 Q4 48.9 48.0 12.9 14.2 16.2 2.9 0.7 1.0 0.4 43.7

2005 Q1 42.0 41.5 10.0 13.0 15.2 1.7 0.6 0.5 0.3 38.5 Q2 44.3 43.7 11.5 13.2 15.1 2.0 1.1 0.6 0.3 40.1 Q3 43.4 42.7 11.1 13.0 15.1 1.9 0.7 0.7 0.3 39.6 Q4 49.0 48.3 13.3 14.2 16.1 3.0 0.8 0.8 0.3 43.9

2006 Q1 42.4 42.0 10.3 13.4 15.1 1.7 0.8 0.4 0.3 38.9 Q2 45.3 44.9 12.2 13.5 15.1 1.9 1.3 0.5 0.3 41.0 Q3 43.7 43.2 11.6 12.9 15.1 2.0 0.8 0.5 0.3 39.9 Q4 49.3 48.7 14.0 14.2 15.8 2.9 0.9 0.6 0.3 44.3

2007 Q1 42.2 41.8 10.2 13.5 14.7 1.7 0.9 0.4 0.3 38.7 Q2 45.5 45.1 12.7 13.5 14.9 1.9 1.4 0.4 0.3 41.3 Q3 43.5 43.1 12.1 12.8 14.8 1.9 0.8 0.5 0.3 39.9 Q4 49.6 49.1 14.4 14.1 15.7 3.0 1.0 0.6 0.3 44.5

2008 Q1 42.3 42.0 10.7 12.9 14.8 1.7 1.1 0.3 0.2 38.6 Q2 44.9 44.5 12.6 12.8 15.0 1.9 1.5 0.4 0.3 40.7 Q3 43.2 42.8 11.9 12.4 15.0 1.9 0.8 0.4 0.3 39.6 Q4 49.0 48.5 13.6 13.6 16.3 3.0 1.1 0.5 0.3 43.8

2009 Q1 42.0 41.8 10.2 12.5 15.4 1.8 1.1 0.1 0.2 38.4 Q2 44.3 43.8 11.5 12.6 15.5 2.0 1.4 0.6 0.5 40.1 Q3 42.5 42.1 10.9 12.2 15.4 2.0 0.7 0.3 0.3 38.9 Q4 48.8 48.1 12.7 13.8 16.4 3.2 0.9 0.7 0.5 43.4

2010 Q1 41.8 41.6 10.1 12.4 15.4 1.9 0.9 0.2 0.3 38.2 Q2 44.3 43.8 11.5 12.8 15.3 2.0 1.3 0.5 0.3 39.9 Q3 42.9 42.6 10.9 12.9 15.2 2.1 0.7 0.3 0.3 39.2 Q4 48.7 48.0 12.7 13.9 16.4 3.0 1.0 0.8 0.3 43.3

2. Euro area _ quarterly expenditure and deficit/surplus

Total Current expenditure Capital expenditure Deficit (-)/ Primary

surplus (+) deficit (-)/Total Compensation Intermediate Interest Current Investment Capital surplus (+)

of consumption transfers Social Subsidies transfersemployees benefits

1 2 3 4 5 6 7 8 9 10 11 12 13

2004 Q4 50.8 45.6 11.0 5.7 2.9 26.0 22.6 1.4 5.2 3.1 2.1 -1.9 1.0

2005 Q1 46.8 43.1 10.2 4.7 3.1 25.1 21.3 1.2 3.7 1.9 1.8 -4.8 -1.7 Q2 46.2 42.8 10.2 4.9 3.2 24.5 21.3 1.1 3.4 2.3 1.1 -1.9 1.3 Q3 45.6 42.2 9.9 4.8 3.0 24.5 21.2 1.2 3.4 2.5 1.0 -2.2 0.8 Q4 50.5 45.7 11.1 5.8 2.7 26.1 22.5 1.3 4.8 3.1 1.7 -1.5 1.2

2006 Q1 45.3 42.2 10.0 4.6 3.0 24.6 21.1 1.2 3.1 1.9 1.2 -2.9 0.1 Q2 45.5 42.2 10.2 4.9 3.1 24.0 21.0 1.1 3.2 2.3 1.0 -0.1 2.9 Q3 45.2 41.8 9.8 4.7 2.9 24.4 21.0 1.2 3.4 2.5 1.0 -1.5 1.4 Q4 50.4 45.0 10.7 5.8 2.7 25.9 22.2 1.4 5.4 3.2 2.2 -1.1 1.6

2007 Q1 44.3 41.1 9.8 4.5 2.9 23.8 20.4 1.1 3.2 2.0 1.2 -2.1 0.8 Q2 44.6 41.4 9.9 4.8 3.2 23.4 20.5 1.1 3.2 2.3 0.9 0.9 4.1 Q3 44.4 40.9 9.5 4.7 2.9 23.8 20.6 1.2 3.4 2.5 0.9 -0.9 2.1 Q4 50.3 45.2 10.6 5.8 2.8 26.0 22.2 1.5 5.1 3.4 1.7 -0.7 2.1

2008 Q1 44.7 41.5 9.7 4.6 3.0 24.1 20.5 1.2 3.2 2.0 1.2 -2.4 0.6 Q2 45.3 42.0 10.1 5.0 3.2 23.7 20.6 1.1 3.4 2.4 1.0 -0.4 2.8 Q3 45.5 41.9 9.6 4.8 3.1 24.4 21.2 1.2 3.6 2.5 1.0 -2.3 0.8 Q4 52.1 47.0 11.0 6.1 2.8 27.1 23.1 1.4 5.1 3.5 1.7 -3.1 -0.3

2009 Q1 48.5 45.0 10.5 5.3 2.9 26.4 22.5 1.3 3.4 2.2 1.2 -6.5 -3.6 Q2 50.1 46.0 10.9 5.5 3.0 26.7 23.1 1.3 4.1 2.7 1.3 -5.8 -2.8 Q3 49.3 45.4 10.3 5.2 2.9 26.9 23.3 1.4 3.9 2.7 1.2 -6.8 -4.0 Q4 55.1 49.7 11.5 6.4 2.6 29.2 24.9 1.5 5.4 3.5 1.9 -6.3 -3.7

2010 Q1 49.7 46.1 10.6 5.2 2.8 27.6 23.3 1.4 3.6 2.1 1.5 -7.9 -5.2 Q2 49.0 45.5 10.7 5.5 2.9 26.4 23.0 1.3 3.5 2.5 1.2 -4.7 -1.8 Q3 49.3 45.0 10.1 5.2 2.9 26.8 23.2 1.3 4.3 2.5 1.8 -6.3 -3.5 Q4 53.7 48.5 11.1 6.3 2.6 28.5 24.6 1.6 5.3 3.1 2.2 -5.0 -2.4

Sources: ECB calculations based on Eurostat and national data.1) Data refer to the Euro 17. The concepts "revenue", "expenditure" and "deficit/surplus" are based on the ESA 95. Transactions between the EU budget and entities outside

the government sector are not included. Otherwise, except for different data transmission deadlines, the quarterly data are consistent with the annual data.The data are not seasonally adjusted.

2) The fiscal burden comprises taxes and social contributions.

6.5 Quarterly debt and change in debt 1) (as a percentage of GDP)

S 60ECBMonthly BulletinMay 2011

1. Euro area _ Maastricht debt by financial instrument 2)

Total Financial instruments

Currency and deposits Loans Short-term securities Long-term securities1 2 3 4 5

2008 Q1 67.1 2.2 11.4 4.9 48.6 Q2 67.5 2.2 11.4 4.9 49.0 Q3 67.5 2.1 11.3 5.5 48.6 Q4 69.9 2.3 11.4 6.7 49.5

2009 Q1 73.5 2.3 11.7 7.9 51.7 Q2 76.6 2.4 12.0 8.4 53.8 Q3 78.4 2.3 12.2 9.2 54.7 Q4 79.3 2.4 12.4 8.5 55.9

2010 Q1 81.1 2.4 12.7 8.4 57.7 Q2 82.4 2.4 13.2 8.0 58.8 Q3 82.5 2.4 13.1 8.2 58.8 Q4 85.2 2.4 15.4 7.7 59.6

2. Euro area _ deficit-debt adjustment

Change in Deficit (-)/ Deficit-debt adjustment Memo

debt surplus (+) item:Total Transactions in main financial assets held by general government Valuation effects Other Borrowing

and other changes requirementTotal Currency Loans Securities Shares and in volume

and deposits other equity1 2 3 4 5 6 7 8 9 10 11

2008 Q1 6.1 -2.4 3.7 3.3 2.0 0.0 0.9 0.3 -0.2 0.6 6.2 Q2 3.8 -0.4 3.3 3.9 1.9 0.3 1.3 0.5 0.1 -0.7 3.7 Q3 2.0 -2.3 -0.3 -0.7 -1.5 0.0 0.3 0.5 0.4 0.0 1.6 Q4 9.1 -3.1 6.0 5.5 0.6 2.5 0.4 2.1 0.1 0.3 8.9

2009 Q1 12.8 -6.5 6.3 6.8 5.2 -0.1 1.0 0.8 -0.5 0.0 13.3 Q2 9.0 -5.8 3.3 3.2 2.3 -0.6 0.3 1.2 -0.4 0.5 9.4 Q3 4.9 -6.8 -2.0 -2.8 -3.2 0.6 0.0 -0.2 0.2 0.6 4.6 Q4 2.3 -6.3 -3.9 -2.5 -2.7 -0.1 0.1 0.2 -0.2 -1.2 2.6

2010 Q1 8.2 -7.9 0.3 0.8 0.8 0.0 -0.3 0.3 -0.3 -0.3 8.5 Q2 7.6 -4.7 2.9 3.4 2.0 1.2 -0.2 0.4 -0.1 -0.4 7.7 Q3 3.0 -6.3 -3.4 -2.9 -2.3 -0.6 -0.1 0.1 0.0 -0.4 3.0 Q4 12.3 -5.0 7.3 7.9 0.8 1.5 5.7 -0.2 0.0 -0.5 12.4

C30 Deficit, borrowing requirement and change in debt

(four-quarter moving sum as a percentage of GDP)

C31 Maastricht debt

(annual change in the debt-to-GDP ratio and underlying factors)

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

9.0

10.0

2001 2002 2003 2004 2005 2006 2007 2008 2009 20100.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

9.0

10.0

deficitchange in debtborrowing requirement

-4.0

-2.0

0.0

2.0

4.0

6.0

8.0

10.0

12.0

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010-4.0

-2.0

0.0

2.0

4.0

6.0

8.0

10.0

12.0

deficit-debt adjustmentprimary deficit/surplusgrowth/interest rate differentialchange in debt-to-GDP ratio

Sources: ECB calculations based on Eurostat and national data.1) Data refer to the Euro 17. Intergovernmental lending in the context of the financial crisis is consolidated.2) The stock data in quarter t are expressed as a percentage of the sum of GDP in t and the previous three quarters.

7EXTERNAL TRANSACTIONS AND POSITIONS

7.1 Summary balance of payments 1) (EUR billions; net transactions)

S 61ECB

Monthly BulletinMay 2011

Current account Net Financial account

Capital lending/ Errors andTotal Goods Services Income Current account borrowing Total Direct Portfolio Financial Other Reserve omissions

transfers to/from investment investment derivatives investment assetsrest of

the world(columns

1+6)

1 2 3 4 5 6 7 8 9 10 11 12 13 14

2008 -142.4 -22.5 41.1 -63.3 -97.7 9.2 -133.2 141.5 -236.0 283.3 -82.9 180.5 -3.4 -8.32009 -25.7 37.5 33.8 -6.4 -90.6 6.6 -19.1 10.0 -109.4 270.7 37.2 -193.1 4.6 9.22010 -36.7 20.7 41.0 1.8 -100.2 7.7 -28.9 34.4 -78.6 143.2 8.0 -28.1 -10.2 -5.4

2009 Q4 13.9 16.3 10.8 5.5 -18.7 1.1 15.0 -14.2 7.3 38.4 4.9 -64.7 0.0 -0.82010 Q1 -17.9 1.6 4.4 11.1 -35.1 2.5 -15.5 16.0 -45.2 24.9 2.7 38.2 -4.6 -0.6 Q2 -18.6 3.3 11.7 -14.8 -18.8 1.7 -16.9 25.4 -29.8 93.7 1.9 -41.4 1.0 -8.5 Q3 -6.2 8.2 14.6 1.4 -30.4 1.0 -5.1 3.9 -30.8 -17.1 2.4 54.3 -5.0 1.3 Q4 6.0 7.6 10.3 4.0 -15.9 2.5 8.5 -10.9 27.2 41.6 1.0 -79.2 -1.6 2.4

2010 Feb. -5.6 4.1 1.8 5.2 -16.7 0.8 -4.8 2.3 -1.7 -8.9 -1.6 18.2 -3.6 2.5 Mar. 0.0 5.6 1.6 2.8 -10.1 0.2 0.2 2.7 -32.7 -4.3 0.0 42.2 -2.5 -2.8 Apr. -4.2 1.4 3.0 -1.1 -7.5 -0.6 -4.8 5.1 -18.4 41.5 -4.2 -13.7 -0.1 -0.3 May -16.0 -1.5 3.7 -12.8 -5.4 1.8 -14.2 20.3 -3.8 51.6 -0.2 -27.2 -0.1 -6.2 June 1.7 3.3 5.0 -0.8 -5.9 0.5 2.1 -0.1 -7.6 0.6 6.3 -0.5 1.1 -2.0 July 5.5 7.2 5.4 2.3 -9.4 1.4 6.9 0.4 -0.6 -25.1 -1.4 30.7 -3.1 -7.4 Aug. -7.1 -3.8 4.0 2.5 -9.8 0.3 -6.8 2.3 -26.9 0.3 4.7 25.8 -1.6 4.6 Sep. -4.6 4.8 5.2 -3.4 -11.2 -0.7 -5.2 1.2 -3.2 7.8 -1.0 -2.2 -0.2 4.1 Oct. 4.0 6.4 2.9 3.3 -8.6 -0.2 3.8 -3.1 -27.7 14.0 -5.2 16.0 -0.2 -0.7 Nov. -3.6 -0.1 3.5 -1.0 -6.0 0.6 -2.9 15.8 45.2 14.2 1.6 -45.2 0.0 -12.9 Dec. 5.6 1.3 3.9 1.6 -1.3 2.1 7.6 -23.6 9.8 13.5 4.6 -50.1 -1.3 15.9

2011 Jan. -20.8 -14.1 1.5 0.1 -8.2 0.4 -20.4 18.3 6.5 -18.1 -2.7 38.3 -5.7 2.1 Feb. -9.5 -1.0 2.1 2.9 -13.5 2.2 -7.3 3.3 -19.6 90.9 -2.1 -67.0 1.0 4.1

12-month cumulated transactions

2011 Feb. -49.1 9.6 41.8 -3.5 -97.0 8.0 -41.1 42.6 -79.2 186.8 0.5 -52.7 -12.8 -1.5

12-month cumulated transactions as a percentage of GDP

2011 Feb. -0.5 0.1 0.5 0.0 -1.1 0.1 -0.4 0.5 -0.9 2.0 0.0 -0.6 -0.1 0.0

C32 Euro area b.o.p.: current account

(seasonally adjusted; 12-month cumulated transactions as a percentage of GDP)

C33 Euro area b.o.p.: direct and portfolio investment

(12-month cumulated transactions as a percentage of GDP)

-2.0

-1.5

-1.0

-0.5

0.0

0.5

1.0

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010-2.0

-1.5

-1.0

-0.5

0.0

0.5

1.0

current account balance

-4.0

-3.0

-2.0

-1.0

0.0

1.0

2.0

3.0

4.0

5.0

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010-4.0

-3.0

-2.0

-1.0

0.0

1.0

2.0

3.0

4.0

5.0

net direct investmentnet portfolio investment

Source: ECB.1) The sign convention is explained in the General Notes.

7.2 Current and capital accounts (EUR billions; transactions)

S 62ECBMonthly BulletinMay 2011

1. Summary current and capital accounts

Current account Capital account

Total Goods Services Income Current transfers

Credit Debit Net Credit Debit Credit Debit Credit Debit Credit Debit Credit Debit

Workers’ Workers’remit- remit-tances tances

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

2008 2,720.2 2,862.6 -142.4 1,590.2 1,612.8 514.4 473.3 524.3 587.6 91.2 6.9 188.9 21.5 24.5 15.22009 2,292.9 2,318.6 -25.7 1,303.6 1,266.0 473.9 440.2 421.5 427.9 93.9 6.4 184.5 22.5 20.6 14.02010 2,593.3 2,630.0 -36.7 1,564.3 1,543.6 515.1 474.0 426.3 424.5 87.7 6.3 187.9 22.0 22.2 14.5

2009 Q4 608.1 594.2 13.9 348.2 331.9 124.1 113.3 103.3 97.8 32.5 1.6 51.2 5.8 6.4 5.32010 Q1 588.6 606.5 -17.9 350.1 348.5 113.2 108.9 103.4 92.3 21.7 1.5 56.8 5.1 5.5 3.0 Q2 647.3 665.8 -18.6 388.7 385.4 128.9 117.2 110.8 125.5 18.9 1.7 37.7 5.2 4.8 3.1 Q3 661.2 667.3 -6.2 403.2 395.0 138.5 123.9 103.9 102.5 15.6 1.7 46.0 5.8 4.8 3.8 Q4 696.3 690.3 6.0 422.3 414.7 134.4 124.1 108.2 104.2 31.4 1.6 47.3 6.0 7.1 4.5

2010 Dec. 241.8 236.3 5.6 137.0 135.7 47.5 43.6 41.2 39.6 16.1 . 17.4 . 4.2 2.2

2011 Jan. 209.1 229.9 -20.8 127.5 141.6 40.8 39.3 32.1 32.0 8.7 . 17.0 . 1.3 0.9 Feb. 220.0 229.5 -9.5 137.2 138.2 37.5 35.4 32.9 30.0 12.4 . 26.0 . 2.9 0.8

Seasonally adjusted

2010 Q2 643.3 654.5 -11.2 388.1 384.8 128.8 119.1 105.8 104.8 20.7 . 45.8 . . . Q3 657.1 665.2 -8.2 395.6 390.3 129.7 118.7 108.0 108.6 23.8 . 47.6 . . . Q4 669.5 685.6 -16.0 408.8 408.8 130.8 120.4 105.6 109.7 24.4 . 46.7 . . .

2010 Dec. 222.2 230.1 -8.0 136.0 137.0 42.9 40.3 35.4 37.1 8.0 . 15.8 . . .

2011 Jan. 231.6 237.2 -5.6 143.5 145.3 44.8 40.6 35.1 35.7 8.3 . 15.6 . . . Feb. 232.7 239.9 -7.2 146.3 148.5 43.0 39.7 35.4 35.6 8.0 . 16.0 . . .

12-month cumulated transactions

2011 Feb. 2,643.8 2,693.4 -49.6 1,608.0 1,600.2 519.4 477.3 425.2 428.8 91.1 . 187.0 . . .

12-month cumulated transactions as a percentage of GDP

2011 Feb. 28.8 29.3 -0.5 17.5 17.4 5.6 5.2 4.6 4.7 1.0 . 2.0 . . .

C34 Euro area b.o.p.: goods

(seasonally adjusted; 12-month cumulated transactions as a percentage of GDP)

C35 Euro area b.o.p.: services

(seasonally adjusted; 12-month cumulated transactions as a percentage of GDP)

8.0

9.0

10.0

11.0

12.0

13.0

14.0

15.0

16.0

17.0

18.0

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 20108.0

9.0

10.0

11.0

12.0

13.0

14.0

15.0

16.0

17.0

18.0

exports (credit)imports (debit)

2.5

3.0

3.5

4.0

4.5

5.0

5.5

6.0

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 20102.5

3.0

3.5

4.0

4.5

5.0

5.5

6.0

exports (credit)imports (debit)

Source: ECB.

EURO AREASTATISTICS

Externaltransactions

andpositions

7.2 Current and capital accounts (EUR billions)

S 63ECB

Monthly BulletinMay 2011

2. Income account(transactions)

Compensation of employees Investment income

Credit Debit Total Direct investment Portfolio investment Other investment

Credit Debit Equity Debt Equity Debt Credit Debit

Credit Debit Credit Debit Credit Debit Credit Debit

Reinv. Reinv.earnings earnings

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16

2008 21.1 13.1 503.2 574.5 141.1 -5.2 115.8 17.8 31.3 26.7 39.3 111.1 119.1 128.5 172.4 192.3 2009 21.9 13.8 399.6 414.1 145.6 16.2 98.6 12.0 24.9 24.2 27.4 77.2 98.7 120.8 102.9 93.4 2010 23.1 13.8 403.2 410.7 170.4 0.4 111.4 16.6 22.4 20.1 29.9 85.8 97.6 122.7 82.9 70.7

2009 Q4 5.9 4.1 97.4 93.7 40.2 1.6 27.0 -0.1 6.5 5.6 6.1 13.9 22.8 28.5 21.9 18.8 2010 Q1 5.8 2.7 97.6 89.6 42.6 2.7 25.9 5.8 5.5 4.4 6.0 12.3 23.1 30.2 20.5 16.8 Q2 5.5 3.3 105.3 122.3 44.9 -8.9 28.7 -3.5 5.8 5.2 9.8 39.5 24.3 31.7 20.5 17.2 Q3 5.5 3.9 98.4 98.5 40.8 9.5 28.8 7.9 5.3 4.7 7.6 17.0 24.9 31.3 19.8 16.7 Q4 6.3 3.9 101.9 100.4 42.1 -2.9 28.0 6.5 5.9 5.8 6.6 17.1 25.3 29.5 22.1 19.9

3. Geographical breakdown(cumulated transactions)

Total EU Member States outside the euro area Brazil Canada China India Japan Russia Switzer- United Other

land StatesTotal Den- Sweden United Other EU EU

mark Kingdom countries insti-2010 Q1 to tutions

2010 Q4 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16

Credits

Current account 2,593.3 862.1 48.7 79.4 407.9 268.3 57.8 46.8 34.1 117.5 36.7 54.8 93.1 196.4 346.2 805.7 Goods 1,564.3 500.2 30.6 52.7 207.4 209.3 0.2 26.7 18.2 96.0 27.2 34.8 68.2 101.4 183.9 507.7 Services 515.1 164.1 10.7 13.6 104.3 29.2 6.2 8.2 7.7 15.4 7.3 12.3 16.3 52.1 75.6 156.1 Income 426.3 138.8 6.8 11.6 85.7 26.4 8.3 11.6 7.3 5.7 2.0 6.7 8.0 34.6 81.1 130.6 Investment income 403.2 132.0 6.7 11.5 84.1 25.7 4.0 11.6 7.2 5.7 1.9 6.6 8.0 24.0 79.3 126.9 Current transfers 87.7 59.1 0.6 1.5 10.4 3.5 43.0 0.3 0.9 0.4 0.3 1.0 0.6 8.3 5.5 11.3 Capital account 22.2 19.1 0.0 0.0 1.1 0.4 17.5 0.0 0.0 0.0 0.0 0.0 0.1 0.4 0.4 2.1

Debits

Current account 2,630.0 814.5 42.2 75.0 355.1 243.0 99.2 - 29.8 - - 92.4 - 173.3 338.2 - Goods 1,543.6 431.0 27.6 46.5 162.1 194.8 0.0 26.0 12.7 202.1 23.4 50.1 105.0 86.2 130.9 476.3 Services 474.0 136.6 7.8 11.2 84.9 32.4 0.2 4.8 6.5 12.5 5.1 9.7 10.3 44.0 98.9 145.7 Income 424.5 134.6 6.3 15.8 96.0 11.3 5.2 - 8.6 - - 31.9 - 34.8 101.4 - Investment income 410.7 126.6 6.2 15.7 94.6 4.9 5.2 - 8.4 - - 31.8 - 34.4 100.5 - Current transfers 187.9 112.3 0.5 1.5 12.1 4.5 93.8 1.4 2.1 3.1 0.8 0.6 0.8 8.3 7.1 51.4 Capital account 14.5 2.5 0.0 0.1 1.2 0.3 0.9 0.2 0.1 0.1 0.2 0.1 0.1 0.5 1.4 9.2

Net

Current account -36.7 47.7 6.5 4.4 52.8 25.3 -41.4 - 4.3 - - -37.6 - 23.1 8.0 - Goods 20.7 69.2 3.1 6.1 45.3 14.5 0.2 0.7 5.5 -106.1 3.8 -15.2 -36.8 15.2 52.9 31.4 Services 41.0 27.5 2.9 2.5 19.4 -3.2 6.0 3.4 1.3 3.0 2.2 2.5 6.0 8.1 -23.3 10.4 Income 1.8 4.3 0.5 -4.2 -10.2 15.1 3.1 - -1.3 - - -25.2 - -0.3 -20.2 - Investment income -7.5 5.4 0.5 -4.3 -10.5 20.8 -1.2 - -1.3 - - -25.1 - -10.5 -21.1 - Current transfers -100.2 -53.3 0.1 0.0 -1.6 -1.0 -50.7 -1.1 -1.2 -2.7 -0.5 0.4 -0.2 0.0 -1.5 -40.0 Capital account 7.7 16.6 0.0 -0.1 -0.1 0.1 16.6 -0.2 -0.1 -0.1 -0.2 -0.1 0.0 -0.1 -1.0 -7.1

Source: ECB.

7.3 Financial account (EUR billions and annual growth rates; outstanding amounts and growth rates at end of period; transactions and other changes during period)

S 64ECBMonthly BulletinMay 2011

1. Summary financial account

Outstanding amounts (international investment position)

Total 1) Total Direct Portfolio Net Other Reserve

as a % of GDP investment investment financial investment assetsderivatives

Assets Liabilities Net Assets Liabilities Net Assets Liabilities Assets Liabilities Assets Liabilities

1 2 3 4 5 6 7 8 9 10 11 12 13 14

2007 13,992.8 15,266.8 -1,274.0 154.9 169.0 -14.1 3,726.7 3,221.9 4,631.1 6,538.1 -28.9 5,316.7 5,506.8 347.22008 13,331.7 14,983.0 -1,651.3 143.9 161.7 -17.8 3,889.7 3,320.2 3,727.6 5,938.3 -29.8 5,370.1 5,724.4 374.22009 13,733.3 15,203.2 -1,469.9 153.1 169.5 -16.4 4,262.0 3,478.6 4,226.3 6,737.2 -45.4 4,830.9 4,987.5 459.6

2010 Q2 14,925.7 16,152.1 -1,226.4 164.6 178.1 -13.5 4,583.5 3,604.6 4,627.9 7,137.6 -46.1 5,177.2 5,409.9 583.3 Q3 14,747.4 16,124.8 -1,377.4 161.4 176.5 -15.1 4,556.9 3,573.6 4,641.8 7,277.0 -55.4 5,051.8 5,274.3 552.2 Q4 15,001.4 16,191.9 -1,190.6 163.0 175.9 -12.9 4,615.0 3,609.1 4,809.7 7,358.2 -75.2 5,060.8 5,224.7 591.2

Changes to outstanding amounts

2006 1,545.9 1,845.3 -299.4 18.0 21.5 -3.5 363.3 284.6 485.1 889.8 0.6 691.2 670.9 5.72007 1,608.0 1,858.8 -250.9 17.8 20.6 -2.8 572.8 486.8 258.7 591.3 -8.1 763.3 780.7 21.42008 -661.1 -283.8 -377.3 -7.1 -3.1 -4.1 163.0 98.3 -903.5 -599.7 -0.9 53.3 217.6 27.02009 401.6 220.2 181.4 4.5 2.5 2.0 372.4 158.3 498.7 798.8 -15.6 -539.2 -737.0 85.4

2010 Q3 -178.3 -27.3 -151.0 -7.8 -1.2 -6.6 -26.6 -31.0 13.9 139.4 -9.3 -125.3 -135.6 -31.0 Q4 254.0 67.1 186.9 10.6 2.8 7.8 58.1 35.5 167.9 81.2 -19.8 8.9 -49.6 39.0

Transactions

2007 1,940.3 1,943.2 -3.0 21.5 21.5 0.0 512.9 422.5 439.5 566.3 66.9 915.8 954.4 5.12008 406.6 548.1 -141.5 4.4 5.9 -1.5 328.8 92.8 -7.2 276.1 82.9 -1.2 179.3 3.42009 -166.8 -156.8 -10.0 -1.9 -1.7 -0.1 325.3 215.9 84.3 355.0 -37.2 -534.6 -727.7 -4.62010 439.4 473.8 -34.4 4.8 5.1 -0.4 166.5 87.9 140.7 283.9 -8.0 130.0 101.9 10.2

2010 Q2 113.2 138.6 -25.4 4.9 6.0 -1.1 83.7 53.8 -19.6 74.1 -1.9 52.0 10.6 -1.0 Q3 81.1 84.9 -3.9 3.5 3.7 -0.2 28.1 -2.6 53.2 36.1 -2.4 -2.8 51.5 5.0 Q4 49.8 38.9 10.9 2.1 1.6 0.5 7.1 34.3 42.9 84.5 -1.0 -0.8 -80.0 1.6

2010 Oct. 101.6 98.5 3.1 . . . 9.0 -18.7 59.3 73.3 5.2 27.8 43.8 0.2 Nov. 57.7 73.5 -15.8 . . . -1.9 43.2 3.1 17.3 -1.6 58.1 12.9 0.0 Dec. -109.5 -133.0 23.6 . . . 0.0 9.8 -19.6 -6.1 -4.6 -86.7 -136.7 1.3

2011 Jan. 140.4 158.7 -18.3 . . . 26.3 32.8 39.5 21.4 2.7 66.2 104.6 5.7 Feb. 36.6 39.8 -3.3 . . . 5.9 -13.7 -1.8 89.0 2.1 31.5 -35.5 -1.0

Other changes

2006 -182.3 123.3 -305.6 -2.1 1.4 -3.6 -54.7 26.2 -35.2 183.4 0.0 -96.9 -86.3 4.42007 -332.3 -84.4 -247.9 -3.7 -0.9 -2.7 59.9 64.3 -180.8 25.1 -75.1 -152.6 -173.8 16.32008 -1,067.7 -831.9 -235.8 -11.5 -9.0 -2.5 -165.8 5.5 -896.3 -875.8 -83.8 54.5 38.3 23.72009 568.4 377.0 191.4 6.3 4.2 2.1 47.1 -57.6 414.4 443.9 21.6 -4.6 -9.3 89.9

Other changes due to exchange rate changes

2006 -343.3 -228.5 -114.8 -4.0 -2.7 -1.3 -72.1 -4.2 -151.6 -101.1 . -105.7 -123.2 -13.92007 -521.9 -339.5 -182.4 -5.8 -3.8 -2.0 -104.1 -17.1 -217.4 -146.9 . -186.7 -175.5 -13.72008 -39.4 55.1 -94.5 -0.4 0.6 -1.0 -20.1 -9.6 6.8 47.4 . -35.4 17.3 9.22009 -45.8 -49.7 3.9 -0.5 -0.6 0.0 -4.8 1.7 -28.4 -27.5 . -10.1 -23.9 -2.5

Other changes due to price changes

2006 288.6 298.4 -9.8 3.4 3.5 -0.1 45.4 33.5 226.0 264.9 0.0 . . 17.12007 78.7 113.4 -34.7 0.9 1.3 -0.4 45.2 5.8 77.3 107.6 -75.1 . . 31.32008 -1,021.5 -1,018.4 -3.1 -11.0 -11.0 0.0 -154.5 -94.8 -812.8 -923.6 -75.8 . . 21.52009 622.1 494.0 128.1 6.9 5.5 1.4 137.9 44.5 402.2 449.5 35.9 . . 46.1

Other changes due to other adjustments

2006 -128.1 56.7 -184.7 -1.5 0.7 -2.2 -28.3 -1.6 -109.6 19.8 . 8.7 38.4 1.22007 110.8 155.1 -44.3 1.2 1.7 -0.5 119.2 76.0 -40.8 64.4 . 33.7 14.7 -1.32008 3.5 155.5 -152.0 0.0 1.7 -1.6 3.8 109.0 -81.8 -12.3 . 88.7 58.8 -7.12009 52.3 -39.6 91.9 0.6 -0.4 1.0 -48.5 -100.9 46.0 34.3 . 5.6 27.0 49.2

Growth rates of outstanding amounts

2006 16.1 14.8 - . . . 15.1 10.6 13.6 13.7 . 20.5 18.8 0.32007 15.6 14.3 - . . . 15.8 15.1 10.0 9.4 . 20.2 20.2 1.62008 2.9 3.6 - . . . 8.9 2.9 -0.5 4.4 . -0.1 3.3 1.02009 -1.3 -1.1 - . . . 8.4 6.6 2.2 5.9 . -10.0 -12.6 -1.2

2010 Q2 2.9 2.6 - . . . 6.7 5.1 3.5 5.4 . -0.4 -2.3 0.7 Q3 3.3 3.2 - . . . 5.3 3.7 3.0 4.0 . 2.1 1.7 1.7 Q4 3.1 3.1 - . . . 3.8 2.5 3.2 4.1 . 2.7 2.0 2.0

Source: ECB.1) Net financial derivatives are included in assets.

EURO AREASTATISTICS

Externaltransactions

andpositions

7.3 Financial account (EUR billions and annual growth rates; outstanding amounts and growth rates at end of period, transactions during period)

S 65ECB

Monthly BulletinMay 2011

2. Direct investment

Oustanding amounts (international investment position)

By resident units abroad By non-resident units in the euro area

Total Equity capital Other capital Total Equity capital Other capital and reinvested earnings (mostly inter-company loans) and reinvested earnings (mostly inter-company loans)

Total MFIs Non- Total MFIs Non- Total Into MFIs Into Total To MFIs ToMFIs MFIs non-MFIs non-MFIs

1 2 3 4 5 6 7 8 9 10 11 12 13 14

2008 3,889.7 3,016.6 214.5 2,802.2 873.0 13.1 859.9 3,320.2 2,360.4 67.1 2,293.2 959.8 19.0 940.82009 4,262.0 3,291.0 228.5 3,062.4 971.1 14.7 956.4 3,478.6 2,531.3 78.2 2,453.1 947.3 18.5 928.8

2010 Q3 4,556.9 3,497.5 243.2 3,254.3 1,059.4 15.7 1,043.7 3,573.6 2,721.9 82.9 2,639.0 851.7 16.1 835.6 Q4 4,615.0 3,522.0 247.6 3,274.4 1,093.0 16.0 1,077.0 3,609.1 2,721.8 86.4 2,635.4 887.3 10.9 876.3

Transactions

2008 328.8 195.4 9.3 186.1 133.4 -0.3 133.7 92.8 57.7 -8.2 65.9 35.0 1.6 33.52009 325.3 234.1 18.2 215.9 91.1 2.4 88.8 215.9 216.4 8.6 207.8 -0.5 -0.6 0.12010 166.5 51.6 7.6 44.0 114.9 1.3 113.6 87.9 136.8 8.0 128.8 -48.9 -7.5 -41.3

2010 Q2 83.7 29.4 -0.5 29.9 54.3 0.5 53.8 53.8 46.8 2.3 44.6 7.0 -2.5 9.5 Q3 28.1 34.3 0.9 33.4 -6.2 0.2 -6.4 -2.6 32.5 2.4 30.1 -35.2 -0.1 -35.1 Q4 7.1 -28.0 0.9 -28.9 35.1 0.3 34.8 34.3 -8.6 2.0 -10.5 42.9 -4.9 47.9

2010 Oct. 9.0 -7.9 -2.3 -5.5 16.9 0.1 16.8 -18.7 -28.0 0.3 -28.3 9.3 -0.3 9.7 Nov. -1.9 -4.8 2.3 -7.1 2.9 0.1 2.8 43.2 8.3 1.5 6.9 34.9 1.9 33.0 Dec. 0.0 -15.3 0.9 -16.3 15.3 0.1 15.2 9.8 11.1 0.2 10.9 -1.3 -6.5 5.2

2011 Jan. 26.3 32.4 0.5 32.0 -6.2 0.2 -6.4 32.8 6.3 0.3 6.0 26.4 2.8 23.6 Feb. 5.9 -3.5 0.3 -3.9 9.5 -0.3 9.7 -13.7 2.9 0.2 2.7 -16.6 -0.5 -16.1

Growth rates

2008 8.9 6.6 4.1 6.9 17.9 -1.2 18.2 2.9 2.4 -13.1 2.8 4.3 8.5 4.22009 8.4 7.7 8.5 7.7 10.5 18.3 10.3 6.6 9.3 12.8 9.2 -0.1 -3.1 0.0

2010 Q2 6.7 4.9 3.4 5.0 13.0 10.8 13.0 5.1 9.4 12.5 9.3 -5.9 -18.6 -5.6 Q3 5.3 4.3 4.0 4.4 8.6 10.7 8.6 3.7 9.2 12.2 9.1 -10.3 -14.3 -10.2 Q4 3.8 1.5 3.3 1.4 11.7 8.6 11.8 2.5 5.4 10.1 5.2 -5.1 -40.4 -4.4

C36 Euro area international investment position

(outstanding amounts at end of period; as a percentage of GDP)

C37 Euro area direct and portfolio investment position

(outstanding amounts at end of period; as a percentage of GDP)

-20.0

-18.0

-16.0

-14.0

-12.0

-10.0

-8.0

-6.0

-4.0

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010-20.0

-18.0

-16.0

-14.0

-12.0

-10.0

-8.0

-6.0

-4.0

net international investment position

-30.0

-25.0

-20.0

-15.0

-10.0

-5.0

0.0

5.0

10.0

15.0

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010-30.0

-25.0

-20.0

-15.0

-10.0

-5.0

0.0

5.0

10.0

15.0

net direct investmentnet portfolio investment

Source: ECB.

7.3 Financial account (EUR billions and annual growth rates; outstanding amounts and growth rates at end of period; transactions during period)

S 66ECBMonthly BulletinMay 2011

3. Portfolio investment assets

Outstanding amounts (international investment position)

Total Equity Debt instruments

Bonds and notes Money market instruments

Total MFIs Non-MFIs Total MFIs Non-MFIs Total MFIs Non-MFIs

Euro- General Euro- General Euro- Generalsystem government system government system government

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16

2008 3,727.6 1,128.6 68.4 3.0 1,060.2 27.1 2,164.2 964.8 20.3 1,199.4 18.6 434.8 358.1 61.7 76.7 1.32009 4,226.3 1,488.7 76.2 3.4 1,412.5 34.4 2,339.5 917.5 17.1 1,422.0 36.5 398.1 327.3 44.9 70.8 2.0

2010 Q3 4,641.8 1,699.8 88.8 3.4 1,611.0 42.0 2,551.6 893.7 17.0 1,657.8 40.4 390.5 316.8 49.0 73.7 0.5 Q4 4,809.7 1,900.9 96.9 3.6 1,804.0 45.3 2,510.8 800.7 15.6 1,710.1 77.1 398.0 312.9 41.7 85.1 0.2

Transactions

2008 -7.2 -98.0 -35.7 0.6 -62.3 0.0 80.7 41.0 3.2 39.7 2.6 10.1 34.9 14.9 -24.8 0.42009 84.3 46.8 -3.2 0.0 50.0 1.5 30.2 -98.3 -3.8 128.5 17.5 7.2 11.8 -12.8 -4.5 0.92010 140.7 81.0 8.4 -0.2 72.6 1.9 103.7 -123.6 -1.2 227.3 51.4 -44.0 -56.5 -10.8 12.5 -1.9

2010 Q2 -19.6 -8.1 -5.8 -0.2 -2.3 2.8 -5.7 -35.4 -0.7 29.7 0.5 -5.8 -17.2 -2.6 11.3 -0.3 Q3 53.2 10.6 1.8 0.0 8.8 -1.3 59.7 6.0 -0.1 53.7 -2.1 -17.1 -7.5 7.2 -9.6 0.3 Q4 42.9 42.7 2.8 0.0 39.9 -0.7 0.1 -97.3 -0.5 97.4 53.4 0.1 -13.2 -9.5 13.3 -0.3

2010 Oct. 59.3 17.6 1.3 0.0 16.3 . 30.0 -49.6 -0.4 79.6 . 11.8 5.4 -3.4 6.4 . Nov. 3.1 15.9 4.2 0.0 11.7 . -15.1 -35.5 0.2 20.4 . 2.3 -2.1 1.1 4.4 . Dec. -19.6 9.3 -2.7 0.1 11.9 . -14.8 -12.3 -0.4 -2.5 . -14.0 -16.5 -7.2 2.5 .

2011 Jan. 39.5 -6.1 -4.1 0.0 -2.1 . 37.5 31.2 0.1 6.2 . 8.1 1.7 3.1 6.5 . Feb. -1.8 4.7 -3.2 0.1 7.9 . 2.7 -4.5 0.4 7.2 . -9.2 -9.8 -0.8 0.5 .

Growth rates

2008 -0.5 -5.9 -27.6 24.6 -4.2 -0.1 3.6 4.2 20.1 3.1 15.4 2.7 11.9 41.1 -27.7 65.92009 2.2 3.4 -5.1 -0.7 3.9 5.4 1.3 -10.0 -18.9 10.5 93.7 1.1 2.6 -22.1 -6.0 68.4

2010 Q2 3.5 8.2 11.8 -6.4 8.0 12.3 4.4 -5.9 -10.8 11.7 -5.7 -14.7 -17.3 -34.2 -2.2 -87.2 Q3 3.0 5.2 7.8 -7.5 5.1 8.5 5.0 -4.7 -7.1 11.6 -7.8 -14.9 -17.3 -2.6 -2.4 -67.9 Q4 3.2 5.1 10.9 -5.2 4.8 5.2 4.3 -13.4 -6.8 15.2 121.3 -10.4 -16.1 -23.6 18.4 -91.3

4. Portfolio investment liabilities

Outstanding amounts (international investment position)

Total Equity Debt instruments

Bonds and notes Money market instruments

Total MFIs Non-MFIs Total MFIs Non-MFIs Total MFIs Non-MFIs

General Generalgovernment government

1 2 3 4 5 6 7 8 9 10 11 12

2008 5,938.3 2,185.3 616.9 1,568.4 3,372.6 1,198.8 2,173.8 1,426.8 380.4 62.0 318.4 269.92009 6,737.2 2,751.8 686.6 2,065.1 3,460.8 1,132.1 2,328.7 1,477.1 524.6 67.7 456.9 422.3

2010 Q3 7,277.0 2,942.9 670.5 2,272.4 3,810.1 1,173.9 2,636.2 1,740.7 523.9 99.5 424.4 377.8 Q4 7,358.2 3,147.1 654.2 2,492.9 3,735.6 1,160.8 2,574.8 1,704.3 475.5 81.1 394.4 358.2

Transactions

2008 276.1 -84.6 84.5 -169.1 177.8 6.8 171.0 154.3 182.9 -33.1 216.0 192.82009 355.0 111.8 2.2 109.6 123.3 7.7 115.5 93.4 119.9 -13.5 133.3 155.52010 283.9 147.5 -5.8 153.2 134.4 45.7 88.7 187.1 2.1 45.1 -43.0 -33.4

2010 Q2 74.1 18.7 2.5 16.1 70.2 -8.5 78.7 97.7 -14.7 -12.6 -2.1 -8.6 Q3 36.1 39.7 15.8 23.9 -37.4 16.1 -53.5 -28.5 33.8 23.5 10.3 11.7 Q4 84.5 77.0 -9.3 86.3 33.2 26.6 6.6 36.4 -25.7 -3.5 -22.2 -16.7

2010 Oct. 73.3 60.3 4.2 56.1 -1.6 8.5 -10.1 . 14.6 -0.5 15.1 . Nov. 17.3 -11.9 0.8 -12.7 17.0 0.5 16.5 . 12.2 2.4 9.8 . Dec. -6.1 28.6 -14.3 42.9 17.8 17.6 0.2 . -52.5 -5.4 -47.1 .

2011 Jan. 21.4 9.0 -0.2 9.2 0.9 33.0 -32.1 . 11.5 13.4 -2.0 . Feb. 89.0 31.9 4.4 27.5 28.8 10.4 18.4 . 28.3 24.3 4.0 .

Growth rates

2008 4.4 -3.7 14.9 -8.1 5.9 0.7 9.2 13.8 78.0 -24.7 218.2 269.42009 5.9 4.8 0.4 6.6 3.6 0.7 5.3 6.6 31.8 -28.6 41.8 58.1

2010 Q2 5.4 6.2 -1.6 9.1 4.3 1.4 5.6 11.7 11.6 75.5 3.0 7.2 Q3 4.0 4.1 -0.7 5.7 3.3 2.0 3.9 10.4 8.9 148.4 -4.7 -3.8 Q4 4.1 5.2 -0.9 7.1 3.8 3.9 3.8 12.4 0.4 70.5 -9.5 -8.1

Source: ECB.

EURO AREASTATISTICS

Externaltransactions

andpositions

7.3 Financial account (EUR billions and annual growth rates; outstanding amounts and growth rates at end of period; transactions during period)

S 67ECB

Monthly BulletinMay 2011

5. Other investment assets

Outstanding amounts (international investment position)

Total Eurosystem MFIs General Other sectors

(excluding Eurosystem) government

Total Loans/ Other Total Loans/ Other Trade Loans/currency Trade Loans/currencycurrency assets currency assets credits and deposits credits and deposits

and anddeposits deposits Currency Currency

and anddeposits deposits

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

2008 5,370.1 28.8 27.8 1.0 3,272.5 3,213.2 59.2 90.8 12.3 42.6 8.8 1,977.9 188.9 1,595.6 431.72009 4,830.9 30.2 29.8 0.4 2,835.9 2,805.4 30.5 109.2 8.4 63.6 11.4 1,855.6 192.4 1,478.8 398.1

2010 Q3 5,051.8 25.0 24.4 0.6 2,963.2 2,930.7 32.5 115.9 8.3 69.1 11.0 1,947.7 207.9 1,528.3 438.0 Q4 5,060.8 32.6 32.0 0.7 2,970.4 2,937.9 32.5 152.9 8.4 104.7 15.9 1,904.9 213.3 1,505.0 428.1

Transactions

2008 -1.2 -9.4 -9.5 0.0 -42.6 -59.2 16.6 -5.7 -1.1 -5.9 -4.7 56.6 -0.3 48.3 -21.92009 -534.6 0.1 0.0 0.1 -421.7 -401.2 -20.5 10.7 -0.4 9.3 1.2 -123.7 1.0 -129.3 -50.82010 130.0 -2.9 -2.9 0.0 8.4 -0.5 9.0 39.6 -0.2 38.8 4.8 84.9 11.8 63.1 29.1

2010 Q2 52.0 -3.4 -3.3 0.0 -3.4 -10.9 7.4 15.1 0.0 14.8 6.1 43.7 9.5 37.1 17.4 Q3 -2.8 1.5 1.6 -0.1 -15.8 -14.6 -1.2 -4.0 -0.1 -4.1 -2.4 15.5 2.3 17.1 11.2 Q4 -0.8 6.1 6.0 0.1 -28.0 -27.6 -0.4 34.6 0.0 34.6 4.8 -13.5 2.2 -20.4 -6.7

2010 Oct. 27.8 -2.7 . . 18.0 . . 25.8 . . -0.6 -13.3 . . 9.7 Nov. 58.1 2.0 . . 39.8 . . 5.0 . . 3.6 11.4 . . -6.6 Dec. -86.7 6.9 . . -85.8 . . 3.8 . . 1.7 -11.6 . . -9.8

2011 Jan. 66.2 -0.5 . . 59.4 . . -5.9 . . -4.3 13.3 . . 18.1 Feb. 31.5 3.0 . . 41.6 . . 1.2 . . 1.0 -14.4 . . -5.5

Growth rates

2007 20.2 153.5 169.3 -1.6 18.3 18.4 11.4 -6.6 -9.7 -12.6 -28.6 24.9 7.6 29.3 16.32008 -0.1 -26.2 -26.9 1.0 -1.3 -1.8 23.6 -6.0 -8.8 -12.3 -35.8 3.1 -0.2 3.2 -5.9

2010 Q2 -0.4 -36.4 -36.9 11.4 -1.2 -1.4 17.6 16.4 -4.1 28.9 -8.0 0.5 3.6 -0.2 -5.9 Q3 2.1 -13.4 -13.1 -22.0 1.0 0.8 21.4 11.1 -3.2 17.9 9.1 3.5 5.3 3.3 -0.8 Q4 2.7 -13.1 -12.9 -9.9 0.4 0.1 28.2 35.4 -2.7 59.2 41.5 4.5 5.9 4.3 7.4

6. Other investment liabilities

Outstanding amounts (international investment position)

Total Eurosystem MFIs General Other sectors

(excluding Eurosystem) government

Total Loans/ Other Total Loans/ Other Total Trade Loans Other Total Trade Loans Othercurrency liabilities currency liabilities credits liabilities credits liabilities

and anddeposits deposits

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

2008 5,724.4 482.9 482.6 0.3 3,762.9 3,708.8 54.1 62.3 0.0 58.0 4.3 1,416.3 178.2 1,059.7 178.42009 4,987.5 252.0 251.6 0.4 3,398.9 3,360.4 38.6 71.6 0.0 67.3 4.4 1,264.9 175.1 911.3 178.5

2010 Q3 5,274.3 249.2 247.5 1.8 3,606.5 3,559.3 47.3 92.0 0.0 86.4 5.6 1,326.5 185.5 948.4 192.7 Q4 5,224.7 268.9 265.8 3.0 3,507.2 3,456.0 51.3 138.8 0.0 133.3 5.4 1,309.7 191.1 955.6 163.0

Transactions

2008 179.3 281.0 280.9 0.1 -174.7 -186.0 11.3 9.3 0.0 10.6 -1.3 63.7 9.0 46.7 8.02009 -727.7 -233.1 -233.3 0.2 -353.2 -341.9 -11.4 12.5 0.0 12.4 0.1 -153.8 -5.5 -125.7 -22.62010 101.9 8.9 6.3 2.6 -3.0 -9.6 6.6 64.4 0.0 63.7 0.7 31.6 10.2 4.5 16.9

2010 Q2 10.6 -0.6 -0.5 0.0 -3.5 -5.7 2.2 8.8 0.0 7.9 1.0 5.9 6.1 -2.2 2.0 Q3 51.5 -2.6 -3.6 1.0 1.9 6.0 -4.1 5.3 0.0 5.4 -0.1 46.9 1.0 34.9 11.0 Q4 -80.0 17.3 16.0 1.3 -105.1 -108.5 3.5 45.8 0.0 45.5 0.3 -38.1 2.4 -34.8 -5.7

2010 Oct. 43.8 0.2 . . 37.5 . . 7.0 . . . -0.9 . . . Nov. 12.9 4.2 . . 9.4 . . 15.9 . . . -16.6 . . . Dec. -136.7 12.9 . . -152.0 . . 22.9 . . . -20.5 . . .

2011 Jan. 104.6 7.1 . . 64.0 . . 13.6 . . . 19.9 . . . Feb. -35.5 4.6 . . -17.1 . . 7.2 . . . -30.2 . . .

Growth rates

2008 3.3 141.1 141.2 . -4.4 -4.7 18.2 17.7 . 22.5 -23.2 4.8 5.3 4.6 5.92009 -12.6 -48.0 -48.1 . -9.4 -9.2 -20.3 19.8 . 21.0 1.9 -10.8 -3.4 -11.8 -11.8

2010 Q2 -2.3 -20.7 -20.9 . -1.6 -1.9 22.0 12.3 . 12.1 12.8 -0.5 -2.3 0.6 -4.4 Q3 1.7 -8.2 -8.6 . 0.5 0.4 11.3 18.2 . 17.8 26.9 6.2 4.5 5.4 11.8 Q4 2.0 3.4 2.4 . 0.0 -0.2 17.2 87.9 . 93.5 10.8 2.4 5.7 0.3 9.4

Source: ECB.

7.3 Financial account (EUR billions and annual growth rates; outstanding amounts and growth rates at end of period; transactions during period)

S 68ECBMonthly BulletinMay 2011

7. Reserve assets 1)

Outstanding amounts (international investment position)

Reserve assets Memo

items

Total Monetary gold SDR Reserve Foreign exchange Other Other Pre- SDR

holdings position claims foreign determined allo-In In fine in the Total Currency and Securities Financial currency short-term cations

EUR troy IMF deposits derivatives assets netbillions ounces drains

(millions) With With Total Equity Bonds Money onmonetary banks and market foreign

authorities notes instruments currencyand the BIS

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17

2007 347.2 201.0 353.688 4.6 3.6 138.0 7.2 22.0 108.5 0.4 87.8 20.3 0.3 0.0 44.3 -38.5 5.32008 374.2 217.0 349.207 4.7 7.3 145.1 7.6 8.1 129.5 0.6 111.3 17.6 0.0 0.0 262.8 -245.7 5.52009 462.4 266.1 347.180 50.8 10.5 134.9 11.7 8.1 115.2 0.5 92.0 22.7 -0.1 0.0 32.1 -24.2 51.2

2010 Q2 583.3 351.9 347.156 56.3 16.3 158.8 9.2 13.0 136.8 0.6 110.8 25.5 -0.3 0.0 32.7 -24.2 56.7 Q3 552.2 332.3 346.994 53.3 15.3 151.3 7.9 15.7 127.2 0.5 106.9 19.8 0.4 0.0 26.2 -22.6 53.7 Q4 591.2 366.2 346.962 54.2 15.8 155.0 7.7 16.1 131.3 0.5 111.2 19.5 0.0 0.0 26.3 -24.4 54.5

2011 Feb. 577.5 353.9 346.986 53.2 16.6 153.8 7.6 14.0 131.9 - - - 0.2 0.0 23.2 -24.3 53.6 Mar. 572.8 351.5 346.988 51.1 21.6 148.6 5.6 18.2 124.4 - - - 0.4 0.0 21.3 -32.5 52.5

Transactions

2007 5.1 -3.2 - 0.3 -0.9 8.8 1.0 1.6 6.2 0.0 14.5 -8.3 0.0 0.0 - - - 2008 3.4 -2.7 - -0.1 3.8 2.4 5.0 -15.7 11.8 0.1 15.8 -4.1 1.3 0.0 - - - 2009 -4.6 -2.0 - 0.5 3.4 -6.4 3.1 -1.2 -9.5 0.0 -14.1 4.6 1.2 0.0 - - -

2010 Q2 -1.0 0.0 - 0.1 3.0 -4.0 -2.0 1.3 -3.2 0.0 0.0 -3.1 -0.1 0.0 - - - Q3 5.0 0.0 - 0.0 -0.1 5.1 -0.5 3.9 1.6 0.0 5.6 -4.0 0.1 0.0 - - - Q4 1.6 0.0 - 0.1 0.1 1.3 -0.4 -0.5 2.1 0.0 3.2 -1.1 0.1 0.0 - - -

Growth rates

2008 1.0 -1.3 - -2.5 105.6 1.7 67.7 -68.9 10.8 28.0 17.9 -20.6 - - - - - 2009 -1.2 -0.9 - -2.6 45.5 -4.4 41.1 -21.3 -7.3 1.0 -12.8 25.3 - - - - - 2010 2.0 0.0 - -0.1 45.4 3.6 -43.3 76.2 3.4 -5.2 10.3 -25.5 - - - - -

2010 Q2 0.7 -0.1 - 8.1 34.9 -0.7 -28.0 56.1 -1.6 -5.2 -3.6 8.1 - - - - - Q3 1.7 0.0 - 1.0 27.8 3.2 -45.3 93.8 2.8 -5.2 9.0 -22.0 - - - - - Q4 2.0 0.0 - -0.1 45.4 3.6 -43.3 76.2 3.4 -5.2 10.3 -25.5 - - - - -

8. Gross external debt

Outstanding amounts (international investment position)

Total By instrument By sector (excluding direct investment)

Loans, Money Bonds Trade Other debt Direct investment: General Eurosystem MFIs Othercurrency market and notes credits liabilities inter-company government (excluding sectors

and instruments lending Eurosystem)deposits

1 2 3 4 5 6 7 8 9 10 11

2007 9,991.0 5,144.6 240.5 2,996.3 172.6 189.6 1,247.3 1,235.4 202.1 5,228.6 2,077.62008 10,916.9 5,309.2 380.4 3,372.6 178.2 237.0 1,439.4 1,759.0 482.9 5,023.7 2,211.82009 10,413.3 4,590.5 524.6 3,460.8 175.1 221.8 1,440.4 1,971.0 252.0 4,598.7 2,151.1

2010 Q2 11,176.9 4,979.5 495.6 3,823.4 183.8 246.7 1,447.9 2,197.4 260.1 4,991.5 2,279.9 Q3 10,982.6 4,841.4 523.9 3,810.1 185.5 247.4 1,374.3 2,210.6 249.2 4,880.0 2,268.6 Q4 10,832.6 4,810.8 475.5 3,735.6 191.2 222.7 1,396.8 2,201.3 268.9 4,749.1 2,216.5

Outstanding amounts as a percentage of GDP

2007 110.5 56.9 2.7 33.1 1.9 2.1 13.8 13.7 2.2 57.8 23.02008 117.9 57.4 4.1 36.4 1.9 2.6 15.5 19.0 5.2 54.3 23.92009 116.1 51.2 5.9 38.6 2.0 2.5 16.1 22.0 2.8 51.3 24.0

2010 Q2 123.4 55.0 5.5 42.2 2.0 2.7 16.0 24.3 2.9 55.1 25.2 Q3 120.3 53.0 5.7 41.7 2.0 2.7 15.1 24.2 2.7 53.5 24.9 Q4 117.8 52.3 5.2 40.6 2.1 2.4 15.2 23.9 2.9 51.7 24.1

Source: ECB.1) Data refer to the changing composition of the euro area, in line with the approach adopted for the reserve assets of the Eurosystem. For further information, see the General Notes.

EURO AREASTATISTICS

Externaltransactions

andpositions

7.3 Financial account (EUR billions; outstanding amounts at end of period; transactions during period)

S 69ECB

Monthly BulletinMay 2011

9. Geographical breakdown

Total EU Member States outside the euro area Canada China Japan Switzer- United Offshore Interna- Otherland States financial tional countries

Total Denmark Sweden United Other EU EU centres organisa-Kingdom countries institutions tions

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

2009 Outstanding amounts (international investment position)

Direct investment 783.5 116.5 2.3 -17.4 -125.6 257.6 -0.3 45.6 44.2 -28.9 129.7 -42.2 77.4 -0.3 441.4 Abroad 4,262.0 1,428.3 34.5 123.7 988.9 281.1 0.0 119.6 48.3 77.7 423.5 784.3 540.9 0.0 839.4 Equity/reinvested earnings 3,291.0 1,073.8 29.1 79.8 735.3 229.5 0.0 95.2 39.1 58.9 349.5 559.7 484.7 0.0 630.1 Other capital 971.1 354.5 5.3 43.9 253.7 51.6 0.0 24.4 9.1 18.8 74.1 224.6 56.2 0.0 209.3 In the euro area 3,478.6 1,311.8 32.2 141.1 1,114.5 23.6 0.3 73.9 4.1 106.6 293.9 826.4 463.5 0.4 398.0 Equity/reinvested earnings 2,531.3 1,077.5 22.7 124.7 922.7 7.2 0.3 61.0 1.1 85.5 201.0 613.4 245.4 0.2 246.4 Other capital 947.3 234.3 9.5 16.5 191.9 16.4 0.1 13.0 3.0 21.1 92.9 213.0 218.1 0.2 151.6 Portfolio investment assets 4,226.3 1,424.7 79.0 156.5 1,000.9 89.1 99.2 95.4 47.5 182.0 107.0 1,349.2 434.2 29.3 557.0 Equity 1,488.7 296.8 8.8 28.8 245.3 13.2 0.6 28.6 45.3 85.7 92.4 469.0 193.3 1.5 275.9 Debt instruments 2,737.6 1,127.9 70.2 127.7 755.6 75.9 98.5 66.8 2.2 96.2 14.6 880.2 240.8 27.8 281.1 Bonds and notes 2,339.5 979.1 62.9 108.0 635.5 74.2 98.4 63.3 1.5 38.1 10.6 739.6 225.5 27.2 254.7 Money market instruments 398.1 148.8 7.3 19.6 120.0 1.7 0.1 3.5 0.7 58.1 4.0 140.7 15.4 0.6 26.3 Other investment -156.6 -107.3 49.4 6.8 -96.5 92.2 -159.3 0.3 -8.7 17.0 -118.6 -106.5 -12.4 14.1 165.6 Assets 4,830.9 2,246.0 108.6 85.4 1,847.6 187.9 16.5 26.8 31.6 95.0 238.8 687.3 591.7 61.3 852.4 General government 109.2 23.3 0.1 5.4 6.8 0.2 10.6 0.0 3.1 0.2 0.2 3.5 1.9 27.3 49.7 MFIs 2,866.1 1,539.2 91.0 51.0 1,240.6 154.0 2.6 15.2 9.3 64.4 125.5 353.0 329.8 20.4 409.4 Other sectors 1,855.6 683.6 17.5 28.9 600.2 33.7 3.3 11.6 19.1 30.4 113.2 330.8 260.0 13.6 393.3 Liabilities 4,987.5 2,353.3 59.2 78.5 1,944.1 95.6 175.8 26.6 40.3 78.0 357.4 793.8 604.1 47.2 686.8 General government 71.6 29.4 0.1 0.4 4.4 0.0 24.5 0.1 0.1 0.5 0.2 22.1 0.3 16.9 2.2 MFIs 3,650.9 1,746.4 47.7 44.2 1,486.4 71.6 96.6 19.4 19.1 45.6 270.3 500.3 499.4 27.6 522.9 Other sectors 1,264.9 577.5 11.4 34.0 453.3 24.0 54.8 7.1 21.2 32.0 86.9 271.4 104.5 2.6 161.8

2010 Q1 to 2010 Q4 Cumulated transactions

Direct investment 78.6 28.8 -0.6 0.6 6.9 22.0 -0.1 -16.4 3.2 -3.0 -12.8 18.8 15.2 -0.1 44.8 Abroad 166.5 75.1 2.4 2.4 38.8 31.4 0.0 4.9 3.0 -4.4 -2.6 27.3 1.6 0.0 61.4 Equity/reinvested earnings 51.6 49.9 2.4 -1.1 21.2 27.4 0.0 3.5 0.2 -3.0 -15.2 -6.2 -19.3 0.0 41.7 Other capital 114.9 25.2 0.0 3.5 17.6 4.0 0.0 1.5 2.8 -1.3 12.6 33.5 20.9 0.0 19.7 In the euro area 87.9 46.3 3.0 1.9 31.9 9.4 0.1 21.3 -0.2 -1.3 10.2 8.5 -13.5 0.1 16.6 Equity/reinvested earnings 136.8 30.6 1.6 4.4 21.7 2.9 0.1 23.2 1.0 1.6 -1.9 15.4 61.0 0.0 6.1 Other capital -48.9 15.7 1.5 -2.6 10.3 6.5 0.0 -1.8 -1.2 -2.9 12.1 -6.8 -74.5 0.1 10.6 Portfolio investment assets 140.7 27.9 1.2 18.6 -11.1 9.5 9.6 -0.8 8.0 -13.2 6.1 25.6 -30.8 -0.4 118.3 Equity 81.0 23.3 1.7 6.1 14.1 1.4 0.1 3.2 7.9 0.0 3.8 11.1 0.5 0.1 31.2 Debt instruments 59.7 4.7 -0.4 12.5 -25.1 8.1 9.6 -4.0 0.1 -13.3 2.3 14.5 -31.2 -0.5 87.1 Bonds and notes 103.7 30.6 0.1 11.9 1.0 8.2 9.4 -5.6 0.1 -0.1 1.2 23.6 -21.9 -0.5 76.3 Money market instruments -44.0 -25.9 -0.5 0.6 -26.1 -0.1 0.1 1.6 0.0 -13.1 1.2 -9.1 -9.4 0.0 10.8 Other investment 28.1 -23.2 2.2 -15.2 13.4 -8.8 -14.8 -3.8 2.3 -1.8 49.2 -7.7 66.5 -25.3 -28.0 Assets 130.0 39.7 2.5 3.9 25.6 5.8 1.9 0.8 8.4 6.4 10.1 16.5 51.4 -7.0 3.5 General government 39.6 17.3 0.6 1.1 13.2 1.8 0.5 1.6 0.0 2.4 0.8 10.7 1.6 0.6 4.7 MFIs 5.5 -19.1 -1.2 -1.4 -21.0 3.8 0.7 -1.1 5.3 -0.5 4.4 -8.6 33.9 -7.6 -1.2 Other sectors 84.9 41.6 3.1 4.2 33.3 0.2 0.8 0.3 3.1 4.5 4.9 14.5 16.0 0.0 0.1 Liabilities 101.9 63.0 0.3 19.2 12.2 14.6 16.8 4.6 6.1 8.2 -39.1 24.2 -15.0 18.3 31.5 General government 64.4 49.9 0.1 0.1 45.4 0.1 4.3 0.1 0.0 -0.3 -0.1 4.9 0.2 9.6 0.1 MFIs 6.0 17.3 0.8 17.1 -18.7 10.6 7.5 4.6 2.9 7.7 -34.6 -12.9 -16.1 8.6 28.5 Other sectors 31.6 -4.2 -0.6 2.0 -14.5 3.9 5.0 0.0 3.2 0.8 -4.4 32.3 0.9 0.2 2.8

Source: ECB.

7.4 Monetary presentation of the balance of payments 1) (EUR billions; transactions)

S 70ECBMonthly BulletinMay 2011

B.o.p. items mirroring net transactions by MFIs

Total Current Transactions by non-MFIs Financial Errors

and derivatives andcapital Direct investment Portfolio investment Other investment omissions

account balance By By non- Assets Liabilities Assets Liabilities

resident residentunits units in Equity Debt Equity Debt

abroad euro area instruments instruments1 2 3 4 5 6 7 8 9 10 11 12

2008 -150.2 -124.8 -320.1 99.3 62.1 -14.5 -169.3 387.7 -51.3 73.3 -82.8 -9.92009 86.1 -19.5 -304.6 207.9 -50.0 -124.0 109.7 249.3 113.1 -141.1 37.2 8.12010 -240.4 -29.5 -157.6 87.3 -72.4 -239.9 153.3 44.9 -123.7 95.9 7.9 -6.5

2009 Q4 43.6 14.7 -63.0 69.9 -35.1 -32.0 47.8 8.9 23.3 5.2 4.9 -0.92010 Q1 -80.9 -15.5 -41.0 1.1 -26.0 -44.0 26.7 27.6 -32.9 21.3 2.7 -0.9 Q2 -43.2 -16.9 -83.7 54.0 2.3 -41.0 16.3 76.9 -58.8 14.7 1.9 -8.9 Q3 -65.7 -5.3 -26.9 -5.1 -8.8 -44.1 24.0 -43.6 -11.4 52.1 2.3 1.0 Q4 -50.6 8.1 -6.0 37.3 -39.9 -110.7 86.4 -16.1 -20.6 7.7 1.0 2.2

2010 Feb. -13.5 -4.9 0.3 -2.4 -2.2 -6.5 13.1 -7.9 -7.4 3.6 -1.6 2.5 Mar. -40.8 0.2 -28.2 -0.7 -12.5 -27.1 2.3 8.3 -8.2 28.3 0.0 -3.2 Apr. -41.4 -4.8 -22.8 3.5 -4.4 -13.5 0.2 37.0 -26.5 -5.6 -4.2 -0.4 May 8.9 -14.2 -37.7 33.4 9.3 -20.6 -1.6 53.7 -46.2 39.3 -0.2 -6.3 June -10.7 2.1 -23.3 17.1 -2.6 -6.9 17.6 -13.8 13.9 -18.9 6.3 -2.1 July -27.9 6.9 -11.7 11.1 3.3 -28.7 -6.1 -17.4 -4.1 27.6 -1.4 -7.5 Aug. -9.1 -6.9 -8.7 -18.9 -4.2 0.4 23.3 -25.3 15.0 6.9 4.7 4.5 Sep. -28.7 -5.3 -6.5 2.7 -7.9 -15.7 6.7 -0.9 -22.3 17.5 -1.0 4.1 Oct. -80.0 3.7 -11.3 -18.6 -16.3 -85.9 56.1 4.7 -12.5 6.2 -5.2 -0.9 Nov. -10.1 -3.0 4.2 39.9 -11.7 -24.8 -12.7 26.6 -16.2 -1.0 1.6 -12.9 Dec. 39.4 7.4 1.1 16.1 -11.9 0.0 43.0 -47.3 8.1 2.5 4.5 16.0

2011 Jan. -26.3 -20.4 -25.6 29.6 2.1 -12.7 9.2 -34.0 -7.3 33.5 -2.7 2.1 Feb. -0.2 -7.3 -5.9 -13.5 -7.9 -7.7 27.5 22.4 13.2 -23.0 -2.1 4.1

12-month cumulated transactions

2011 Feb. -226.8 -41.6 -176.3 101.6 -64.7 -243.3 165.6 13.9 -93.2 113.3 0.4 -2.6

C38 Main b.o.p. items mirroring developments in MFI net external transactions 1)

(EUR billions; 12-month cumulated transactions)

-500

-400

-300

-200

-100

0

100

200

300

400

500

2007 2008 2009 2010-500

-400

-300

-200

-100

0

100

200

300

400

500

total mirroring net external transactions by MFIscurrent and capital account balancedirect and portfolio equity investment abroad by non-MFIsportfolio investment liabilities of non-MFIs in the form of debt instruments

Source: ECB.1) Data refer to the changing composition of the euro area. For further information, see the General Notes.

EURO AREASTATISTICS

Externaltransactions

andpositions

7.5 Trade in goods

S 71ECB

Monthly BulletinMay 2011

1. Values and volumes by product group 1) (seasonally adjusted, unless otherwise indicated)

Values (EUR billions; annual percentage changes for columns 1 and 2)

Total (n.s.a.) Exports (f.o.b.) Imports (c.i.f.)

Total Memo item: Total Memo items:

Exports Imports Intermediate Capital Consumption Manufacturing Intermediate Capital Consumption Manufacturing Oil

1 2 3 4 5 6 7 8 9 10 11 12 13

2009 -18.1 -21.8 1,279.8 628.0 264.4 355.5 1,063.2 1,264.7 732.8 193.7 316.7 840.9 180.92010 20.2 22.4 1,535.0 765.8 309.1 420.2 1,271.7 1,542.6 944.5 226.5 345.3 1,014.7 245.3

2010 Q1 12.9 9.8 353.2 176.5 69.4 98.3 292.1 352.1 211.0 52.3 82.0 232.0 55.6 Q2 22.4 27.6 380.4 190.2 76.2 103.9 316.2 385.2 236.2 56.4 85.7 252.9 62.2 Q3 22.8 26.7 397.5 197.6 80.3 108.2 329.9 399.5 244.3 59.6 88.8 264.9 62.3 Q4 22.2 25.9 403.9 201.6 83.2 109.8 333.5 405.9 253.0 58.2 88.8 264.8 65.3

2010 Sep. 22.6 21.9 133.0 66.1 27.4 36.4 110.9 131.9 80.8 19.2 29.6 87.9 19.5 Oct. 21.1 22.4 134.3 66.7 27.8 36.2 111.5 131.4 80.9 19.3 29.5 87.0 20.4 Nov. 24.5 29.4 134.9 67.7 28.0 36.7 111.8 137.8 85.3 19.8 30.2 89.7 22.2 Dec. 21.1 25.8 134.7 67.1 27.4 36.9 110.2 136.7 86.8 19.1 29.1 88.2 22.6

2011 Jan. 27.1 29.3 140.0 69.8 27.2 38.4 114.0 143.1 90.1 20.3 29.8 90.9 24.5 Feb. 23.1 26.0 142.2 . . . 117.2 144.6 . . . 91.7 .

Volume indices (2000 = 100; annual percentage changes for columns 1 and 2)

2009 -16.6 -13.8 119.6 114.8 119.0 128.0 116.0 109.6 100.9 115.7 136.4 111.0 101.52010 16.1 12.6 136.9 132.5 137.3 143.5 134.1 120.6 113.0 129.2 142.2 127.5 100.2

2010 Q1 12.9 7.1 129.5 126.3 124.6 138.4 126.1 116.8 108.5 123.6 140.5 121.4 99.4 Q2 17.8 16.6 135.8 131.9 134.9 142.0 133.5 120.6 113.2 128.8 141.7 127.2 99.7 Q3 17.3 14.3 139.9 134.8 142.3 145.3 137.4 121.7 113.9 132.5 142.4 129.8 100.3 Q4 16.3 12.6 142.2 137.1 147.5 148.3 139.5 123.5 116.4 132.0 144.2 131.4 101.4

2010 Aug. 24.5 21.4 140.7 135.2 140.6 146.8 137.8 124.0 116.0 135.6 144.2 132.5 104.0 Sep. 17.0 9.9 140.4 135.3 145.9 146.2 138.5 120.5 112.6 128.0 143.0 129.2 94.7 Oct. 15.2 9.0 142.3 136.6 148.6 146.6 140.1 120.5 112.9 130.6 143.4 129.1 98.5 Nov. 18.6 16.9 143.0 138.3 149.7 150.1 140.9 127.4 119.8 137.1 147.3 134.4 105.6 Dec. 15.0 11.9 141.2 136.3 144.1 148.3 137.5 122.5 116.5 128.4 141.8 130.7 100.1

2011 Jan. 18.2 12.5 144.4 139.0 142.3 150.9 140.2 124.5 117.4 133.6 140.8 131.5 101.2

2. Prices 2) (annual percentage changes, unless otherwise indicated)

Industrial producer export prices (f.o.b.) 3) Industrial import prices (c.i.f.)

Total Total Memo Total Total Memo

(index: item: (index: item:2005 = 100) Intermediate Capital Consumer Energy Manufac- 2005 = 100) Intermediate Capital Consumer Energy Manufac-

goods goods goods turing goods goods goods turing

% of total 100.0 100.0 33.1 44.5 17.9 4.5 99.2 100.0 100.0 28.4 27.9 22.1 21.6 81.1

1 2 3 4 5 6 7 8 9 10 11 12 13 14

2009 101.5 -2.7 -4.0 0.5 0.5 -23.7 -2.6 100.2 -8.5 -4.8 2.3 0.9 -28.3 -2.42010 105.4 3.9 4.8 1.1 2.2 26.3 3.8 110.0 9.8 9.8 1.5 2.7 27.5 6.0

2010 Q3 106.3 4.6 6.7 1.6 2.8 19.6 4.5 111.1 10.8 11.9 2.9 4.0 25.8 7.3 Q4 106.6 5.1 7.1 2.0 2.9 21.5 5.0 112.6 11.6 13.4 2.3 5.3 25.8 8.02011 Q1 108.8 5.6 8.3 1.9 2.8 25.4 5.5 . . . 0.1 . . 6.7

2010 Oct. 106.0 4.7 6.9 1.6 2.8 18.9 4.6 110.7 10.2 12.4 1.9 4.5 21.7 7.0 Nov. 106.4 4.8 7.0 1.9 2.8 18.1 4.7 111.9 10.9 13.1 2.5 5.5 22.6 7.9 Dec. 107.4 5.8 7.5 2.3 3.1 27.4 5.6 115.2 13.7 14.8 2.6 5.9 32.9 9.1

2011 Jan. 108.4 6.0 8.6 2.3 3.1 25.1 5.9 117.1 12.2 12.2 1.5 6.1 31.7 7.3 Feb. 109.0 5.8 8.7 1.8 2.8 25.9 5.7 118.3 12.3 12.0 0.9 5.9 31.2 7.0 Mar. 108.9 4.9 7.7 1.5 2.5 25.1 4.8 . . . -2.1 . . 5.8

Source: Eurostat.1) Product groups as classified in the Broad Economic Categories. Unlike the product groups shown in Table 2, intermediate and consumption product groups include

agricultural and energy products.2) Product groups as classified in the Main Industrial Groupings. Unlike the product groups shown in Table 1, intermediate and consumer goods do not include

energy products, and agricultural goods are not covered. Manufacturing has a different composition compared with the data shown in columns 7 and 12 of Table 1. Data shownare price indices which follow the pure price change for a basket of products and are not simple ratios of the value and volume data shown in Table 1, which are affectedby changes in the composition and quality of traded goods. These indices differ from the GDP deflators for imports and exports (shown in Table 3 in Section 5.1), mainlybecause those deflators include all goods and services and cover cross-border trade within the euro area.

3) Industrial producer export prices refer to direct transactions between domestic producers and non-domestic customers. Contrary to the data shown for values and volumes in Table 1, exports from wholesalers and re-exports are not covered.

7.5 Trade in goods (EUR billions, unless otherwise indicated; seasonally adjusted)

S 72ECBMonthly BulletinMay 2011

3. Geographical breakdown

Exports (f.o.b.)

Total EU Member States outside the euro area Russia Switzer- Turkey United Asia Africa Latin Other

land States America countriesDenmark Sweden United Other EU China Japan

Kingdom countries

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

2009 1,279.8 27.3 41.6 175.3 174.6 50.1 78.9 34.8 152.4 284.4 69.0 28.6 92.0 54.3 29.52010 1,535.0 30.2 52.7 195.4 209.4 63.7 93.1 47.4 180.4 354.8 94.7 34.5 104.8 73.2 18.7

2009 Q3 322.4 6.8 10.6 44.5 44.2 12.1 19.9 9.3 36.6 72.0 17.9 7.2 22.8 14.4 7.8 Q4 329.6 6.7 10.8 45.0 45.3 12.9 19.8 9.3 37.9 75.0 19.0 7.3 23.0 14.4 7.3

2010 Q1 353.2 7.0 11.9 46.5 47.8 13.7 21.4 10.7 41.4 81.7 22.1 7.9 24.9 16.8 5.0 Q2 380.4 7.4 13.3 48.0 51.4 15.4 22.9 11.4 45.1 88.2 23.3 8.7 25.6 18.6 6.4 Q3 397.5 7.6 13.5 50.3 54.2 17.2 24.1 12.1 47.6 91.7 23.8 8.9 26.7 18.9 4.3 Q4 403.9 8.2 14.0 50.6 56.0 17.4 24.7 13.2 46.3 93.3 25.5 9.0 27.5 19.0 3.0

2010 Sep. 133.0 2.6 4.6 17.0 18.3 5.7 8.0 4.2 16.0 31.0 8.1 3.0 9.0 6.3 0.5 Oct. 134.3 2.6 4.6 16.8 18.4 5.8 7.9 4.3 15.7 31.0 8.4 3.1 9.0 6.2 1.9 Nov. 134.9 2.6 4.6 17.0 18.6 6.0 8.2 4.5 15.5 31.6 8.7 3.0 9.2 6.6 0.1 Dec. 134.7 3.0 4.8 16.7 19.1 5.7 8.6 4.4 15.1 30.7 8.4 2.9 9.3 6.2 1.0

2011 Jan. 140.0 2.6 4.9 17.5 19.2 6.1 8.3 4.8 16.5 32.1 9.4 3.1 9.4 6.3 1.4 Feb. 142.2 . . . . 6.5 8.4 5.1 16.8 33.5 9.7 3.1 9.2 7.0 .

Percentage share of total exports

2010 100.0 2.0 3.4 12.7 13.6 4.1 6.1 3.1 11.7 23.1 6.2 2.2 6.8 4.8 1.2

Imports (c.i.f.)

2009 1,264.7 27.1 38.3 127.1 161.8 83.8 65.2 26.5 116.1 379.7 157.7 44.0 94.6 59.5 -25.22010 1,542.6 27.6 47.6 148.2 197.3 111.0 74.1 30.7 128.8 491.3 208.1 50.7 118.4 74.8 -48.9

2009 Q3 314.6 6.8 9.8 31.9 41.1 22.4 16.2 6.8 27.1 93.4 38.0 11.1 22.8 14.8 -7.6 Q4 323.5 6.8 9.9 32.5 42.9 24.1 16.1 6.9 27.9 95.2 38.6 11.0 24.5 15.3 -9.7

2010 Q1 352.1 6.6 10.4 34.9 45.1 25.7 17.1 7.3 29.3 110.3 45.9 11.7 27.0 16.6 -11.1 Q2 385.2 6.9 11.9 36.6 48.8 28.3 19.5 7.6 31.7 125.0 53.4 12.6 29.6 18.1 -14.8 Q3 399.5 7.0 12.6 37.9 50.6 27.5 19.1 7.6 33.9 129.4 55.3 13.4 29.4 19.4 -10.2 Q4 405.9 7.0 12.8 38.8 52.8 29.4 18.4 8.2 34.0 126.6 53.4 13.0 32.3 20.8 -12.9

2010 Sep. 131.9 2.4 4.1 12.2 17.1 8.9 6.2 2.6 11.2 42.6 18.3 4.6 9.6 6.5 -3.0 Oct. 131.4 2.4 4.2 12.8 17.4 9.4 6.1 2.6 11.1 41.8 18.2 4.2 9.3 7.0 -4.6 Nov. 137.8 2.3 4.3 13.2 17.7 9.7 6.2 2.7 11.4 42.8 17.6 4.6 11.7 6.9 -3.4 Dec. 136.7 2.4 4.3 12.8 17.7 10.4 6.2 2.8 11.5 42.0 17.6 4.2 11.3 6.8 -4.9

2011 Jan. 143.1 2.2 4.2 13.5 18.2 11.1 6.3 3.0 11.9 43.5 17.6 4.4 12.2 7.1 -4.0 Feb. 144.6 . . . . 10.3 6.3 3.0 11.9 44.1 17.8 4.5 12.4 6.9 .

Percentage share of total imports

2010 100.0 1.8 3.1 9.6 12.8 7.2 4.8 2.0 8.4 31.8 13.5 3.3 7.7 4.8 -3.2

Balance

2009 15.1 0.2 3.3 48.2 12.7 -33.7 13.7 8.3 36.3 -95.3 -88.7 -15.3 -2.6 -5.2 54.72010 -7.6 2.6 5.0 47.3 12.1 -47.2 18.9 16.7 51.6 -136.4 -113.4 -16.2 -13.6 -1.6 67.6

2009 Q3 7.8 -0.1 0.8 12.6 3.1 -10.3 3.7 2.6 9.5 -21.4 -20.1 -4.0 0.0 -0.4 15.4 Q4 6.1 0.0 0.9 12.4 2.4 -11.2 3.7 2.4 10.0 -20.3 -19.6 -3.7 -1.5 -0.9 17.0

2010 Q1 1.1 0.4 1.5 11.6 2.7 -12.0 4.3 3.4 12.1 -28.6 -23.8 -3.8 -2.1 0.2 16.1 Q2 -4.8 0.5 1.3 11.5 2.6 -12.9 3.4 3.8 13.4 -36.8 -30.1 -4.0 -4.1 0.4 21.1 Q3 -1.9 0.6 0.9 12.4 3.6 -10.3 5.0 4.4 13.7 -37.7 -31.5 -4.5 -2.7 -0.5 14.5 Q4 -2.0 1.1 1.2 11.8 3.2 -12.0 6.3 5.0 12.3 -33.3 -27.9 -4.0 -4.8 -1.7 15.9

2010 Sep. 1.2 0.2 0.5 4.8 1.3 -3.3 1.9 1.6 4.8 -11.5 -10.3 -1.6 -0.6 -0.2 3.5 Oct. 2.9 0.2 0.4 4.0 1.0 -3.6 1.8 1.7 4.7 -10.8 -9.8 -1.1 -0.3 -0.8 6.5 Nov. -2.9 0.3 0.3 3.8 0.9 -3.7 2.1 1.7 4.1 -11.3 -8.9 -1.6 -2.5 -0.3 3.5 Dec. -2.0 0.6 0.5 3.9 1.3 -4.7 2.4 1.5 3.5 -11.2 -9.2 -1.3 -2.0 -0.7 5.9

2011 Jan. -3.1 0.4 0.7 4.0 1.0 -4.9 2.0 1.9 4.6 -11.4 -8.2 -1.4 -2.8 -0.9 5.4 Feb. -2.4 . . . . -3.9 2.1 2.2 4.9 -10.6 -8.1 -1.3 -3.2 0.1 .

Source: Eurostat.

8EXCHANGE RATES

8.1 Effective exchange rates 1) (period averages; index: 1999 Q1=100)

S 73ECB

Monthly BulletinMay 2011

EER-20 EER-40

Nominal Real Real Real Real Real Nominal RealCPI PPI GDP ULCM ULCT CPI

deflator

1 2 3 4 5 6 7 8

2008 110.4 109.9 107.6 105.0 115.2 104.3 117.9 107.12009 111.7 110.6 104.9 106.0 120.6 105.9 120.6 108.02010 104.6 103.0 98.8 98.4 109.8 98.2 112.3 99.3

2010 Q1 108.7 107.0 102.2 102.2 114.5 102.5 116.9 103.5 Q2 103.1 101.8 97.4 97.2 108.7 97.0 110.4 97.9 Q3 102.3 100.8 96.9 96.4 107.1 95.7 109.8 97.2 Q4 104.4 102.4 98.7 97.8 108.8 97.6 112.1 98.72011 Q1 103.7 101.5 97.7 . . . 111.6 97.9

2010 Apr. 106.1 104.6 100.0 - - - 113.5 100.6 May 102.8 101.4 97.0 - - - 109.9 97.5 June 100.6 99.4 95.2 - - - 107.7 95.6 July 102.5 101.1 97.0 - - - 109.9 97.5 Aug. 102.1 100.6 96.6 - - - 109.5 97.0 Sep. 102.5 100.8 97.2 - - - 110.0 97.2 Oct. 106.0 104.1 100.4 - - - 113.8 100.3 Nov. 104.7 102.7 98.9 - - - 112.5 99.0 Dec. 102.6 100.5 96.7 - - - 110.1 96.8

2011 Jan. 102.4 100.3 96.7 - - - 110.1 96.6 Feb. 103.4 101.1 97.6 - - - 111.4 97.6 Mar. 105.2 103.0 98.9 - - - 113.2 99.4 Apr. 107.0 104.9 100.6 - - - 115.0 101.0

Percentage change versus previous month

2011 Apr. 1.7 1.8 1.7 - - - 1.6 1.6Percentage change versus previous year

2011 Apr. 0.9 0.3 0.5 - - - 1.3 0.3

C39 Effective exchange rates

(monthly averages; index: 1999 Q1=100)

C40 Bilateral exchange rates

(monthly averages; index: 1999 Q1=100)

70

80

90

100

110

120

130

140

150

2000 2002 2004 2006 2008 201070

80

90

100

110

120

130

140

150

nominal EER-20real CPI-deflated EER-20

70

80

90

100

110

120

130

140

150

2000 2002 2004 2006 2008 201070

80

90

100

110

120

130

140

150

USD/EURJPY/EURGBP/EUR

Source: ECB.1) For a definition of the trading partner groups and other information, please refer to the General Notes.

8.2 Bilateral exchange rates (period averages; units of national currency per euro)

S 74ECBMonthly BulletinMay 2011

Bulgarian Czech Danish Latvian Lithuanian Hungarian Polish New Roma- Swedish Pound Croatian New Turkishlev koruna krone lats litas forint zloty nian leu krona sterling kuna lira

1 2 3 4 5 6 7 8 9 10 11 12

2008 1.9558 24.946 7.4560 0.7027 3.4528 251.51 3.5121 3.6826 9.6152 0.79628 7.2239 1.90642009 1.9558 26.435 7.4462 0.7057 3.4528 280.33 4.3276 4.2399 10.6191 0.89094 7.3400 2.16312010 1.9558 25.284 7.4473 0.7087 3.4528 275.48 3.9947 4.2122 9.5373 0.85784 7.2891 1.9965

2010 Q3 1.9558 24.928 7.4498 0.7089 3.4528 282.44 4.0087 4.2553 9.3804 0.83305 7.2532 1.9560 Q4 1.9558 24.789 7.4547 0.7095 3.4528 275.77 3.9666 4.2888 9.2139 0.85944 7.3683 1.98972011 Q1 1.9558 24.375 7.4550 0.7049 3.4528 272.43 3.9460 4.2212 8.8642 0.85386 7.4018 2.1591

2010 Oct. 1.9558 24.531 7.4567 0.7094 3.4528 274.01 3.9496 4.2787 9.2794 0.87638 7.3277 1.9800 Nov. 1.9558 24.633 7.4547 0.7094 3.4528 275.51 3.9520 4.2940 9.3166 0.85510 7.3830 1.9717 Dec. 1.9558 25.174 7.4528 0.7096 3.4528 277.62 3.9962 4.2929 9.0559 0.84813 7.3913 2.0159

2011 Jan. 1.9558 24.449 7.4518 0.7034 3.4528 275.33 3.8896 4.2624 8.9122 0.84712 7.4008 2.0919 Feb. 1.9558 24.277 7.4555 0.7037 3.4528 271.15 3.9264 4.2457 8.7882 0.84635 7.4149 2.1702 Mar. 1.9558 24.393 7.4574 0.7072 3.4528 270.89 4.0145 4.1621 8.8864 0.86653 7.3915 2.2108 Apr. 1.9558 24.301 7.4574 0.7092 3.4528 265.29 3.9694 4.1004 8.9702 0.88291 7.3639 2.1975

Percentage change versus previous month

2011 Apr. 0.0 -0.4 0.0 0.3 0.0 -2.1 -1.1 -1.5 0.9 1.9 -0.4 -0.6Percentage change versus previous year

2011 Apr. 0.0 -4.0 0.2 0.2 0.0 -0.1 2.4 -0.7 -7.2 1.0 1.4 10.0

Australian Brazilian Canadian Chinese Hong Kong Icelandic Indian Indonesian Israeli Japanese Malaysiandollar real dollar yuan renminbi dollar krona 1) rupee 2) rupiah shekel yen ringgit

13 14 15 16 17 18 19 20 21 22 23

2008 1.7416 2.6737 1.5594 10.2236 11.4541 143.83 63.6143 14,165.16 5.2561 152.45 4.88932009 1.7727 2.7674 1.5850 9.5277 10.8114 - 67.3611 14,443.74 5.4668 130.34 4.90792010 1.4423 2.3314 1.3651 8.9712 10.2994 - 60.5878 12,041.70 4.9457 116.24 4.2668

2010 Q3 1.4289 2.2589 1.3416 8.7388 10.0324 - 59.9818 11,612.07 4.8978 110.68 4.0716 Q4 1.3747 2.3037 1.3757 9.0405 10.5441 - 60.9153 12,178.16 4.9154 112.10 4.23042011 Q1 1.3614 2.2799 1.3484 9.0028 10.6535 - 61.9255 12,171.85 4.9247 112.57 4.1668

2010 Oct. 1.4164 2.3378 1.4152 9.2665 10.7835 - 61.7399 12,407.16 5.0192 113.67 4.3092 Nov. 1.3813 2.3391 1.3831 9.0895 10.5941 - 61.4539 12,224.00 4.9770 112.69 4.2588 Dec. 1.3304 2.2387 1.3327 8.7873 10.2776 - 59.6472 11,925.21 4.7618 110.11 4.1313

2011 Jan. 1.3417 2.2371 1.3277 8.8154 10.3945 - 60.7161 12,077.47 4.7909 110.38 4.0895 Feb. 1.3543 2.2765 1.3484 8.9842 10.6312 - 62.0142 12,165.92 4.9939 112.77 4.1541 Mar. 1.3854 2.3220 1.3672 9.1902 10.9093 - 62.9526 12,263.18 4.9867 114.40 4.2483 Apr. 1.3662 2.2889 1.3834 9.4274 11.2269 - 64.1128 12,493.48 4.9573 120.42 4.3502

Percentage change versus previous month

2011 Apr. -1.4 -1.4 1.2 2.6 2.9 - 1.8 1.9 -0.6 5.3 2.4

Percentage change versus previous year

2011 Apr. -5.5 -2.8 2.7 3.0 7.9 - 7.5 3.2 -0.4 -3.9 1.3

Mexican New Zealand Norwegian Philippine Russian Singapore South African South Korean Swiss Thai USpeso dollar krone peso rouble dollar rand won franc baht dollar

24 25 26 27 28 29 30 31 32 33 34

2008 16.2911 2.0770 8.2237 65.172 36.4207 2.0762 12.0590 1,606.09 1.5874 48.475 1.47082009 18.7989 2.2121 8.7278 66.338 44.1376 2.0241 11.6737 1,772.90 1.5100 47.804 1.39482010 16.7373 1.8377 8.0043 59.739 40.2629 1.8055 9.6984 1,531.82 1.3803 42.014 1.3257

2010 Q3 16.5210 1.7979 7.9561 58.363 39.5260 1.7503 9.4593 1,526.12 1.3321 40.825 1.2910 Q4 16.8206 1.7915 8.0499 59.240 41.7192 1.7693 9.3785 1,538.70 1.3225 40.728 1.35832011 Q1 16.5007 1.8107 7.8236 59.876 39.9976 1.7467 9.5875 1,530.79 1.2871 41.771 1.3680

2010 Oct. 17.2845 1.8498 8.1110 60.285 42.1471 1.8116 9.6165 1,560.30 1.3452 41.636 1.3898 Nov. 16.8386 1.7703 8.1463 59.485 42.3360 1.7739 9.5320 1,544.16 1.3442 40.826 1.3661 Dec. 16.3797 1.7587 7.9020 58.050 40.7385 1.7262 9.0143 1,513.74 1.2811 39.805 1.3220

2011 Jan. 16.1926 1.7435 7.8199 59.089 40.2557 1.7193 9.2652 1,495.50 1.2779 40.827 1.3360 Feb. 16.4727 1.7925 7.8206 59.558 39.9469 1.7421 9.8126 1,524.99 1.2974 41.918 1.3649 Mar. 16.8063 1.8877 7.8295 60.870 39.8061 1.7757 9.6862 1,568.05 1.2867 42.506 1.3999 Apr. 16.9211 1.8331 7.8065 62.361 40.5363 1.8024 9.7200 1,567.52 1.2977 43.434 1.4442

Percentage change versus previous month

2011 Apr. 0.7 -2.9 -0.3 2.4 1.8 1.5 0.3 0.0 0.9 2.2 3.2

Percentage change versus previous year

2011 Apr. 3.2 -2.6 -1.6 4.3 3.6 -2.6 -1.5 4.9 -9.5 0.4 7.7

Source: ECB.1) The most recent rate for the Icelandic krona refers to 3 December 2008.2) For this currency the ECB computes and publishes euro reference exchange rates as from 1 January 2009. Previous data are indicative.

9DEVELOPMENTS OUTSIDE THE EURO AREA

9.1 Economic and financial developments in other EU Member States (annual percentage changes, unless otherwise indicated)

S 75ECB

Monthly BulletinMay 2011

HICP

Bulgaria Czech Denmark Latvia Lithuania Hungary Poland Romania Sweden UnitedRepublic Kingdom

1 2 3 4 5 6 7 8 9 10

2009 2.5 0.6 1.1 3.3 4.2 4.0 4.0 5.6 1.9 2.22010 3.0 1.2 2.2 -1.2 1.2 4.7 2.7 6.1 1.9 3.3

2010 Q4 4.0 2.0 2.5 1.7 2.9 4.3 2.7 7.8 1.8 3.42011 Q1 4.5 1.9 2.6 3.8 3.2 4.3 3.6 7.5 1.3 4.1

2011 Jan. 4.3 1.9 2.6 3.5 2.8 4.0 3.5 7.0 1.4 4.0 Feb. 4.6 1.9 2.6 3.8 3.0 4.2 3.3 7.6 1.2 4.4 Mar. 4.6 1.9 2.5 4.1 3.7 4.6 4.0 8.0 1.4 4.0

General government deficit (-)/surplus (+) as a percentage of GDP

2008 1.7 -2.7 3.2 -4.2 -3.3 -3.7 -3.7 -5.7 2.2 -5.02009 -4.7 -5.9 -2.7 -9.7 -9.5 -4.5 -7.3 -8.5 -0.7 -11.42010 -3.2 -4.7 -2.7 -7.7 -7.1 -4.2 -7.9 -6.4 0.0 -10.4

General government gross debt as a percentage of GDP

2008 13.7 30.0 34.5 19.7 15.6 72.3 47.1 13.4 38.8 54.42009 14.6 35.3 41.8 36.7 29.5 78.4 50.9 23.6 42.8 69.62010 16.2 38.5 43.6 44.7 38.2 80.2 55.0 30.8 39.8 80.0

Long-term government bond yield as a percentage per annum; period average

2010 Oct. 5.82 3.43 2.46 9.24 5.15 6.87 5.53 7.02 2.64 2.80 Nov. 5.74 3.59 2.65 8.99 5.15 7.38 5.82 7.04 2.86 3.03 Dec. 5.76 3.89 3.01 7.55 5.15 7.92 5.98 7.09 3.21 3.34

2011 Jan. 5.56 3.98 3.05 5.38 5.15 7.70 6.26 6.66 3.28 3.82 Feb. 5.48 4.05 3.23 6.17 5.15 7.39 6.26 7.03 3.41 4.00 Mar. 5.38 4.05 3.29 6.49 5.15 7.29 6.27 7.31 3.35 3.78

3-month interest rate as a percentage per annum; period average

2010 Oct. 3.99 1.20 1.19 1.22 1.61 5.90 3.83 6.44 1.37 0.74 Nov. 3.99 1.22 1.24 0.95 1.59 5.87 3.86 6.35 1.59 0.74 Dec. 3.93 1.22 1.21 0.83 1.56 6.17 3.92 6.00 1.86 0.75

2011 Jan. 3.91 1.20 1.22 0.85 1.36 6.13 4.01 5.03 2.02 0.77 Feb. 3.88 1.21 1.24 0.89 1.40 6.93 4.11 5.49 2.20 0.80 Mar. 3.90 1.21 1.31 0.85 1.40 6.64 4.18 5.85 2.38 0.81

Real GDP

2009 -5.5 -4.1 -5.2 -18.0 -14.7 -6.7 1.7 -7.1 -5.3 -4.92010 0.2 2.3 2.1 -0.3 1.3 1.2 3.8 -1.3 5.5 1.3

2010 Q3 0.5 2.7 3.7 2.6 1.6 2.2 4.6 -2.2 6.8 2.5 Q4 2.8 2.6 2.9 3.6 4.6 2.3 3.9 -0.6 7.2 1.52011 Q1 . . . . . . . . . 1.8

Current and capital account balance as a percentage of GDP

2009 -7.6 -2.0 3.5 11.0 7.7 1.5 -0.5 -3.6 7.4 -1.52010 -0.2 -2.9 5.4 5.5 4.5 3.9 -1.6 -3.9 6.2 -2.3

2010 Q2 -4.6 -2.6 5.0 7.3 7.6 4.2 -0.9 -7.3 6.2 -1.7 Q3 15.4 -8.2 7.0 3.2 0.0 3.6 -2.8 -1.3 5.9 -2.3 Q4 -6.8 -1.4 6.3 0.8 7.1 3.2 -2.4 -2.1 5.8 -2.4

Gross external debt as a percentage of GDP

2008 104.9 . 177.7 129.2 71.3 122.3 57.0 56.0 203.2 441.42009 107.9 53.2 189.8 156.3 87.2 141.5 59.6 69.0 204.8 416.6

2010 Q2 107.2 55.1 202.1 164.9 90.2 152.8 63.2 76.4 213.2 427.4 Q3 103.6 55.7 200.9 162.5 89.4 141.9 66.2 74.8 198.6 430.4 Q4 101.8 57.4 191.8 165.2 86.0 140.7 65.4 75.8 191.9 420.8

Unit labour costs

2009 12.7 3.5 4.7 -7.0 -2.8 1.9 1.6 -1.3 4.8 6.12010 0.8 -0.2 -1.5 -10.6 -7.6 -1.1 6.1 0.8 -1.6 2.1

2010 Q2 -0.7 -0.3 -2.1 -13.1 -9.5 -2.6 5.9 6.6 -1.7 1.6 Q3 -2.0 1.4 -2.6 -7.2 -5.6 -0.7 4.8 -2.7 -2.6 1.3 Q4 -1.9 1.0 -1.2 1.4 -3.1 -1.9 6.6 -3.9 -1.6 0.9

Standardised unemployment rate as a percentage of labour force (s.a.)

2009 6.9 6.7 6.0 17.2 13.7 10.0 8.2 6.9 8.3 7.62010 10.3 7.3 7.4 18.7 17.8 11.1 9.6 7.3 8.4 7.8

2010 Q4 11.3 7.1 7.7 17.2 17.3 11.1 9.7 7.4 7.9 7.82011 Q1 11.5 7.0 . . . 12.1 9.8 . 7.7 .

2011 Jan. 11.6 7.1 7.9 . . 12.3 9.7 . 7.9 7.7 Feb. 11.5 7.0 7.9 . . 12.1 9.8 . 7.6 . Mar. 11.4 6.9 . . . 11.9 9.8 . 7.7 .

Sources: ECB, European Commission (Economic and Financial Affairs DG and Eurostat), national data, Thomson Reuters and ECB calculations.

9.2 Economic and financial developments in the United States and Japan (annual percentage changes, unless otherwise indicated)

S 76ECBMonthly BulletinMay 2011

United States

Consumer Unit labour Real GDP Industrial Unemployment Broad 3-month 10-year Exchange Fiscal Grossprice index costs 1) production rate money 2) interbank zero coupon rate 4) deficit (-)/ public

index as a % of deposit government as national surplus (+) debt 5)

(manufacturing) labour force rate 3) bond yield; 3) currency as a % of as a % of(s.a.) end of per euro GDP GDP

period

1 2 3 4 5 6 7 8 9 10 11

2007 2.9 2.4 1.9 3.1 4.6 6.3 5.30 4.81 1.3705 -2.9 48.42008 3.8 2.2 0.0 -4.7 5.8 7.1 2.93 2.70 1.4708 -6.3 56.72009 -0.4 -1.6 -2.6 -13.5 9.3 7.9 0.69 4.17 1.3948 -11.3 68.62010 1.6 -1.5 2.9 5.9 9.6 2.3 0.34 3.57 1.3257 -10.6 77.4

2010 Q1 2.4 -2.8 2.4 2.2 9.7 1.9 0.26 4.01 1.3829 -10.7 71.7 Q2 1.8 -1.9 3.0 7.5 9.6 1.7 0.44 3.13 1.2708 -11.1 73.3 Q3 1.2 -1.0 3.2 7.2 9.6 2.6 0.39 2.69 1.2910 -10.4 75.3 Q4 1.3 -0.1 2.8 6.6 9.6 3.2 0.29 3.57 1.3583 -10.3 77.42011 Q1 2.1 . 2.3 7.1 8.9 4.4 0.31 3.76 1.3680 . .

2010 Dec. 1.5 - - 7.0 9.4 3.4 0.30 3.57 1.3220 - -

2011 Jan. 1.6 - - 6.8 9.0 4.3 0.30 3.68 1.3360 - - Feb. 2.1 - - 7.3 8.9 4.1 0.31 3.73 1.3649 - - Mar. 2.7 - - 7.1 8.8 4.6 0.31 3.76 1.3999 - - Apr. . - - . . . 0.28 3.55 1.4442 - -

Japan

2007 0.1 -2.3 2.3 2.8 3.8 1.6 0.79 1.70 161.25 -2.4 156.22008 1.4 1.7 -1.2 -3.4 4.0 2.1 0.93 1.21 152.45 -2.2 162.02009 -1.4 1.3 -6.3 -21.9 5.1 2.7 0.47 1.42 130.34 -8.7 180.42010 -0.7 . 4.0 16.6 5.1 2.8 0.23 1.18 116.24 . .

2010 Q1 -1.2 -4.5 5.4 28.2 5.0 2.8 0.25 1.48 125.48 . . Q2 -0.9 -2.1 3.3 21.2 5.1 2.9 0.24 1.18 117.15 . . Q3 -0.8 -3.3 4.7 14.0 5.0 2.8 0.24 1.03 110.68 . . Q4 0.1 . 2.5 6.0 5.0 2.6 0.19 1.18 112.10 . . 2011 Q1 0.0 . . -2.5 . 2.5 0.19 1.33 112.57 . .

2010 Dec. 0.0 - - 5.9 4.9 2.4 0.18 1.18 110.11 - -

2011 Jan. 0.0 - - 4.6 4.9 2.3 0.19 1.29 110.38 - - Feb. 0.0 - - 2.9 4.6 2.4 0.19 1.35 112.77 - - Mar. 0.0 - - -12.9 . 2.7 0.20 1.33 114.40 - - Apr. . - - . . . 0.20 1.26 120.42 - -

C41 Real gross domestic product

(annual percentage changes; quarterly data)

C42 Consumer price indices

(annual percentage changes; monthly data)

-15

-10

-5

0

5

10

2000 2002 2004 2006 2008 2010-15

-10

-5

0

5

10

euro areaUnited StatesJapan

-4

-2

0

2

4

6

2000 2002 2004 2006 2008 2010-4

-2

0

2

4

6

euro areaUnited StatesJapan

Sources: National data (columns 1, 2 (United States), 3, 4, 5 (United States), 6, 9 and 10); OECD (column 2 (Japan)); Eurostat (column 5 (Japan), euro area chart data);Thomson Reuters (columns 7 and 8); ECB calculations (column 11).1) Seasonally adjusted. The data for the United States refer to the private non-agricultural business sector.2) Period averages; M2 for the United States, M2+CDs for Japan.3) Percentages per annum. For further information on the three-month interbank deposit rate, see Section 4.6.4) For more information, see Section 8.2.5) Gross consolidated general government debt (end of period).6) Data refer to the changing composition of the euro area. For further information, see the General Notes.

6)

S 77ECB

Monthly Bulletin

May 2011

LIST OF CHARTS

C1 Monetary aggregates S12

C2 Counterparts S12

C3 Components of monetary aggregates S13

C4 Components of longer-term fi nancial liabilities S13

C5 Loans to other fi nancial intermediaries and non-fi nancial corporations S14

C6 Loans to households S14

C7 Loans to government S16

C8 Loans to non-euro area residents S16

C9 Total deposits by sector (fi nancial intermediaries) S17

C10 Total deposits and deposits included in M3 by sector (fi nancial intermediaries) S17

C11 Total deposits by sector (non-fi nancial corporations and households) S18

C12 Total deposits and deposits included in M3 by sector (non-fi nancial corporations and households) S18

C13 Deposits by government and non-euro area residents S19

C14 MFI holdings of securities S20

C15 Total outstanding amounts and gross issues of securities other than shares issued by euro area residents S35

C16 Net issues of securities other than shares: seasonally adjusted and non-seasonally adjusted S37

C17 Annual growth rates of long-term debt securities, by sector of the issuer, in all currencies combined S38

C18 Annual growth rates of short-term debt securities, by sector of the issuer, in all currencies combined S39

C19 Annual growth rates for quoted shares issued by euro area residents S40

C20 Gross issues of quoted shares by sector of the issuer S41

C21 New deposits with an agreed maturity S43

C22 New loans with a fl oating rate and up to 1 year’s initial rate fi xation S43

C23 Euro area money market rates S44

C24 3-month money market rates S44

C25 Euro area spot yield curves S45

C26 Euro area spot rates and spreads S45

C27 Dow Jones EURO STOXX broad index, Standard & Poor’s 500 and Nikkei 225 S46

C28 Employment – persons employed and hours worked S55

C29 Unemployment and job vacancy rates S55

C30 Defi cit, borrowing requirement and change in debt S60

C31 Maastricht debt S60

C32 Euro area b.o.p: current account S61

C33 Euro area b.o.p: direct and portfolio investment S61

C34 Euro area b.o.p: goods S62

C35 Euro area b.o.p: services S62

C36 Euro area international investment position S65

C37 Euro area direct and portfolio investment position S65

C38 Main b.o.p. items mirroring developments in MFI net external transactions S70

C39 Effective exchange rates S73

C40 Bilateral exchange rates S73

C41 Real gross domestic product S76

C42 Consumer price indices S76

ECB

Monthly Bulletin

May 2011 S 79

TECHNICAL NOTES

EURO AREA OVERVIEW

CALCULATION OF GROWTH RATES FOR MONETARY

DEVELOPMENTS

The average growth rate for the quarter ending

in month t is calculated as:

a)

where It is the index of adjusted outstanding

amounts as at month t (see also below).

Likewise, for the year ending in month t, the

average growth rate is calculated as:

b)

SECTIONS 2.1 TO 2.6

CALCULATION OF TRANSACTIONS

Monthly transactions are calculated from

monthly differences in outstanding amounts

adjusted for reclassifi cations, other revaluations,

exchange rate variations and any other changes

which do not arise from transactions.

If Lt represents the outstanding amount at the end

of month t, C t

M the reclassifi cation adjustment

in month t, E t

M the exchange rate adjustment

and V t

M the other revaluation adjustments, the

transactions F t

M in month t are defi ned as:

c)

Similarly, the quarterly transactions F t

Q for the

quarter ending in month t are defi ned as:

d) Ft = (L

t – L

t–3) – C

t – E

t – V

tQ Q Q Q

where Lt-3

is the amount outstanding at the end

of month t-3 (the end of the previous quarter)

and, for example, C t

Q is the reclassifi cation

adjustment in the quarter ending in month t.

For those quarterly series for which monthly

observations are now available (see below), the

quarterly transactions can be derived as the sum

of the three monthly transactions in the quarter.

CALCULATION OF GROWTH RATES FOR MONTHLY

SERIES

Growth rates can be calculated from transactions

or from the index of adjusted outstanding

amounts. If F t

M and Lt are defi ned as above,

the index It of adjusted outstanding amounts in

month t is defi ned as:

e)

The base of the index (for the non-seasonally

adjusted series) is currently set as December

2006 = 100. Time series for the index of

adjusted outstanding amounts are available on

the ECB’s website (www.ecb.europa.eu) in the

“Monetary and fi nancial statistics” sub-section

of the “Statistics” section.

The annual growth rate at for month t – i.e. the

change in the 12 months ending in month t – can

be calculated using either of the following

two formulae:

f)

g)

Unless otherwise indicated, the annual growth

rates refer to the end of the indicated period.

For example, the annual percentage change for

the year 2002 is calculated in g) by dividing

the index for December 2002 by the index for

December 2001.

−1

⎞

⎠

⎟⎟⎟⎟

⎞

⎠

⎟⎟⎟⎟

×100

0.5It−12 + ∑ It−i−12 + 0.5It−15

2

i=1

0.5It + ∑ It−i + 0.5It−3

2

i=1

⎞

⎠

⎟⎟⎟⎟

⎞

⎠

⎟⎟⎟⎟

−1 ×1000.5It + ∑ It−i + 0.5It−12

11

i=1

0.5It−12 + ∑ It−i−12 + 0.5It−24

11

i=1

Ft = (L

t – L

t–1) – C

t – E

t – V

tM M M M

I t = It−1 ×Ft

Lt−1

M⎛

⎝⎜

⎞

⎠⎟1+

at = F

t−iL

t−1−i

M

i=0

⎛

⎝⎜

⎞

⎠⎟

⎡

⎣⎢

⎤

⎦⎥×100∏ 1 + −1

11

at = I

tI

t−12

⎛⎝⎜

⎞⎠⎟× 100−1

ECB

Monthly Bulletin

May 2011S 80

Growth rates for intra-annual periods can be

derived by adapting formula g). For example,

the month-on-month growth rate aM

t can be

calculated as:

h)

Finally, the three-month moving average

(centred) for the annual growth rate of M3 is

obtained as (at+1

+ at + a

t-1)/3, where a

t is defi ned

as in f) or g) above.

CALCULATION OF GROWTH RATES FOR

QUARTERLY SERIES

If F t

Q and Lt-3

are defi ned as above, the index It

of adjusted outstanding amounts for the quarter

ending in month t is defi ned as:

i)

The annual growth rate in the four quarters

ending in month t (i.e. at) can be calculated

using formula g).

SEASONAL ADJUSTMENT OF THE EURO AREA

MONETARY STATISTICS 1

The approach used is based on multiplicative

decomposition using X-12-ARIMA.2 The

seasonal adjustment may include a day-of-the-

week adjustment, and for some series it is carried

out indirectly by means of a linear combination

of components. This is the case for M3, which is

derived by aggregating the seasonally adjusted

series for M1, M2 less M1, and M3 less M2.

The seasonal adjustment procedures are fi rst

applied to the index of adjusted outstanding

amounts.3 The resulting estimates of seasonal

factors are then applied to the levels and to the

adjustments arising from reclassifi cations and

revaluations, in turn yielding seasonally adjusted

transactions. Seasonal (and trading day) factors

are revised at annual intervals or as required.

SECTIONS 3.1 TO 3.5

EQUALITY OF USES AND RESOURCES

In Section 3.1 the data conform to a basic

accounting identity. For non-fi nancial

transactions, total uses equal total resources

for each transaction category. This accounting

identity is also refl ected in the fi nancial

account – i.e. for each fi nancial instrument

category, total transactions in fi nancial assets

equal total transactions in liabilities. In the

other changes in assets account and the fi nancial

balance sheets, total fi nancial assets equal total

liabilities for each fi nancial instrument category,

with the exception of monetary gold and special

drawing rights, which are by defi nition not a

liability of any sector.

CALCULATION OF BALANCING ITEMS

The balancing items at the end of each account

in Sections 3.1, 3.2 and 3.3 are computed as

follows.

The trade balance equals euro area imports

minus exports vis-à-vis the rest of the world for

goods and services.

ItIt−1

at =M −1

⎛

⎝⎜

⎞

⎠⎟ ×100

It = It−3 ×⎛

⎝⎜

⎞

⎠⎟Lt−3

FtQ

1+

For details, see “Seasonal adjustment of monetary aggregates and 1

HICP for the euro area”, ECB (August 2000) and the “Monetary

and fi nancial statistics” sub-section of the “Statistics” section of

the ECB’s website (www.ecb.europa. eu).

For details, see Findley, D., Monsell, B., Bell, W., Otto, M. 2

and Chen, B. C. (1998), “New Capabilities and Methods of

the X-12-ARIMA Seasonal Adjustment Program”, Journal

of Business and Economic Statistics, 16, 2, pp.127-152, or

“X-12-ARIMA Reference Manual”, Time Series Staff, Bureau

of the Census, Washington, D.C.

For internal purposes, the model-based approach of

TRAMO-SEATS is also used. For details of TRAMO-SEATS,

see Gomez, V. and Maravall, A. (1996), “Programs TRAMO and

SEATS: Instructions for the User”, Banco de España, Working

Paper No 9628, Madrid.

It follows that for the seasonally adjusted series, the level of the 3

index for the base period (i.e. December 2001) generally differs

from 100, refl ecting the seasonality of that month.

ECB

Monthly Bulletin

May 2011 S 81

EURO AREASTATISTICS

Technical Notes

Net operating surplus and mixed income

is defi ned for resident sectors only and is

calculated as gross value added (gross domestic

product at market prices for the euro area) minus

compensation of employees (uses) minus other

taxes less subsidies on production (uses) minus

consumption of fi xed capital (uses).

Net national income is defi ned for resident

sectors only and is computed as net operating

surplus and mixed income plus compensation of

employees (resources) plus taxes less subsidies

on production (resources) plus net property

income (resources minus uses).

Net disposable income is also defi ned only

for resident sectors and equals net national

income plus net current taxes on income and

wealth (resources minus uses) plus net social

contributions (resources minus uses) plus net

social benefi ts other than social transfers in kind

(resources minus uses) plus net other current

transfers (resources minus uses).

Net saving is defi ned for resident sectors and

is calculated as net disposable income plus

the net adjustment for the change in the net

equity of households in pension fund reserves

(resources minus uses) minus fi nal consumption

expenditure (uses). For the rest of the world, the

current external account is compiled as the trade

balance plus all net income (resources minus

uses).

Net lending/net borrowing is computed from

the capital account as net saving plus net capital

transfers (resources minus uses) minus gross

capital formation (uses) minus acquisitions

less disposals of non-produced non-fi nancial

assets (uses) plus consumption of fi xed capital

(resources). It can also be calculated in the

fi nancial account as total transactions in fi nancial

assets minus total transactions in liabilities

(also known as changes in net fi nancial worth

(wealth) due to transactions). For the household

and non-fi nancial corporation sectors, there is

a statistical discrepancy between the balancing

items computed from the capital account and

the fi nancial account.

Changes in net fi nancial worth (wealth) due to

transactions are computed as total transactions

in fi nancial assets minus total transactions in

liabilities, whereas other changes in net fi nancial

worth (wealth) are calculated as (total) other

changes in fi nancial assets minus (total) other

changes in liabilities.

Net fi nancial worth (wealth) is calculated as

total fi nancial assets minus total liabilities,

whereas changes in net fi nancial worth (wealth)

are equal to the sum of changes in net fi nancial

worth (wealth) due to transactions (lending/net

borrowing from the fi nancial account) and other

changes in net fi nancial worth (wealth).

Changes in net worth (wealth) are calculated

as changes in net worth (wealth) due to savings

and capital transfers plus other changes in net

fi nancial worth (wealth) and other changes in

non-fi nancial assets.

The net worth (wealth) of households is

calculated as the sum of the non-fi nancial assets

and net fi nancial worth (wealth) of households.

SECTIONS 4.3 AND 4.4

CALCULATION OF GROWTH RATES FOR DEBT

SECURITIES AND QUOTED SHARES

Growth rates are calculated on the basis of

fi nancial transactions and therefore exclude

reclassifi cations, revaluations, exchange rate

variations and any other changes which do not

arise from transactions. They can be calculated

from transactions or from the index of notional

stocks. If Nt

M represents the transactions

(net issues) in month t and Lt the level outstanding

at the end of month t, the index It of notional

stocks in month t is defi ned as:

j)

As a base, the index is set equal to 100 in

December 2008. The growth rate at for month t,

I t = It−1 ×Nt

Lt−1

⎛

⎝⎜

⎞

⎠⎟1+

ECB

Monthly Bulletin

May 2011S 82

corresponding to the change in the 12 months

ending in month t, can be calculated using either

of the following two formulae:

k)

l)

The method used to calculate the growth rates

for securities other than shares is the same as

that used for the monetary aggregates, the only

difference being that an “N” is used instead of

an “F”. This is to show that the method used to

obtain “net issues” for securities issues statistics

differs from that used to calculate equivalent

“transactions” for the monetary aggregates.

The average growth rate for the quarter ending

in month t is calculated as:

m)

where It is the index of notional stocks as at

month t. Likewise, for the year ending in month t,

the average growth rate is calculated as:

n)

The calculation formula used for Section 4.3 is

also used for Section 4.4 and is likewise based on

that used for the monetary aggregates. Section 4.4

is based on market values, and the calculations

are based on fi nancial transactions, which

exclude reclassifi cations, revaluations and any

other changes that do not arise from transactions.

Exchange rate variations are not included, as all

quoted shares covered are denominated in euro.

SEASONAL ADJUSTMENT OF SECURITIES ISSUES

STATISTICS 4

The approach used is based on multiplicative

decomposition using X-12-ARIMA. The

seasonal adjustment of total securities issues

is carried out indirectly by means of a linear

combination of sector and maturity component

breakdowns.

The seasonal adjustment procedures are

applied to the index of notional stocks. The

resulting estimates of seasonal factors are then

applied to the outstanding amounts, from which

seasonally adjusted net issues are derived.

Seasonal factors are revised at annual intervals

or as required.

As in formulae k) and l), the growth rate at for

month t, corresponding to the change in the six

months ending in month t, can be calculated

using either of the following two formulae:

o)

p)

TABLE 1 IN SECTION 5.1

SEASONAL ADJUSTMENT OF THE HICP 4

The approach used is based on multiplicative

decomposition using X-12-ARIMA (see

footnote 2 on page S78). The seasonal

adjustment of the overall HICP for the euro

area is carried out indirectly by aggregating

the seasonally adjusted euro area series for

processed food, unprocessed food, industrial

at = N

t−iL

t−1−i

M

i=0

⎛

⎝⎜

⎞

⎠⎟

⎡

⎣⎢

⎤

⎦⎥×100∏ 1 + −1

11

at =It

It−12

⎛⎝⎜

⎞⎠⎟×100−1

−1

⎞

⎠

⎟⎟⎟⎟

⎞

⎠

⎟⎟⎟⎟

×1002

0.5It−12 + ∑ It−i−12 + 0.5It−15i=1

0.5It + ∑ It−i + 0.5It−3

2

i=1

⎞

⎠

⎟⎟⎟⎟

⎞

⎠

⎟⎟⎟⎟

−1 ×1000.5It + ∑ It−i + 0.5It−12

11

i=1

0.5It−12 + ∑ It−i−12 + 0.5It−24

11

i=1

For details, see “Seasonal adjustment of monetary aggregates and 4

HICP for the euro area”, ECB (August 2000) and the “Monetary

and fi nancial statistics” sub-section of the “Statistics” section of

the ECB’s website (www.ecb.europa.eu).

at = N

t−iLt−1−i

M

i=0

⎛

⎝⎜

⎞

⎠⎟

⎡

⎣⎢

⎤

⎦⎥×100∏ 1 + −1

5

at =ItIt−6

⎛⎝⎜

⎞⎠⎟×100−1

ECB

Monthly Bulletin

May 2011 S 83

EURO AREASTATISTICS

Technical Notes

goods excluding energy, and services. Energy

is added without adjustment, since there is no

statistical evidence of seasonality. Seasonal

factors are revised at annual intervals or as

required.

TABLE 2 IN SECTION 7.1

SEASONAL ADJUSTMENT OF THE BALANCE

OF PAYMENTS CURRENT ACCOUNT

The approach used is based on multiplicative

decomposition, using X-12-ARIMA or

TRAMO-SEATS depending on the item.

The raw data for goods, services, income and

current transfers are pre-adjusted in order to take

into account signifi cant working day effects.

The working day adjustment for goods and

services takes account of national public holidays.

The seasonal adjustment of these items is carried

out using these pre-adjusted series. The seasonal

adjustment of the total current account is carried

out by aggregating the seasonally adjusted euro

area series for goods, services, income and current

transfers. Seasonal (and trading day) factors are

revised at biannual intervals or as required.

SECTION 7.3

CALCULATION OF GROWTH RATES FOR THE

QUARTERLY AND ANNUAL SERIES

The annual growth rate for quarter t is calculated

on the basis of quarterly transactions (Ft) and

positions (Lt) as follows:

The growth rate for the annual series is equal to

the growth rate in the last quarter of the year.

at

t

= ×100⎛⎝⎜

⎛⎝⎜

⎞⎠⎟

⎞⎠⎟

i=t–3∏ 1 + Fi

Li–l

— −1

ECB

Monthly Bulletin

May 2011 S 85

The “Euro area statistics” section of the

Monthly Bulletin focuses on statistics for the

euro area as a whole. More detailed and longer

runs of data, with further explanatory notes, are

available in the “Statistics” section of the ECB’s

website (www.ecb.europa.eu). This allows user-

friendly access to data via the ECB’s Statistical

Data Warehouse (http://sdw.ecb.europa.eu),

which includes search and download facilities.

Further services available in the “Data services”

sub-section include subscriptions to different

datasets and a repository of compressed Comma

Separated Value (CSV) fi les. For further

information, please contact us at: statistics@

ecb.europa.eu.

In general, the cut-off date for the statistics

included in the Monthly Bulletin is the day

preceding the Governing Council of the ECB’s

fi rst meeting of the month. For this issue,

the cut-off date was 4 May 2011.

Unless otherwise indicated, all data series

including observations for 2011 relate to

the “Euro 17” (i.e. the euro area including

Estonia) for the whole time series. For interest

rates, monetary statistics, the HICP

and reserve assets (and, for consistency reasons,

the components and counterparts of M3

and the components of the HICP), euro area

statistical series take into account the changing

composition of the euro area.

The composition of the euro area has changed

a number of times over the years. When the euro

was introduced in 1999, the euro area comprised

the following 11 countries (the Euro 11):

Belgium, Germany, Ireland, Spain, France, Italy,

Luxembourg, the Netherlands, Austria, Portugal

and Finland. Greece then joined in 2001, forming

the Euro 12. Slovenia joined in 2007, forming

the Euro 13; Cyprus and Malta joined in 2008,

forming the Euro 15; and Slovakia joined in

2009, forming the Euro 16. Finally, Estonia

joined in 2011, bringing the number of euro area

countries to 17.

EURO AREA SERIES WITH A FIXED COMPOSITION

Aggregated statistical series for fi xed

compositions of the euro area relate to a given

fi xed composition for the whole time series,

regardless of the composition at the time

to which the statistics relate. For example,

aggregated series are calculated for the Euro 17

(i.e. aggregating the data of all 17 countries

currently in the euro area) for all years,

despite the fact that the euro area has only had

this composition since 1 January 2011. Unless

otherwise indicated, the ECB’s Monthly Bulletin

provides statistical series for the current

composition.

EURO AREA SERIES WITH A CHANGING

COMPOSITION

Aggregated statistical series with a changing

composition take into account the composition

of the euro area at the time to which the statistics

relate. For example, euro area statistical series

with a changing composition aggregate the data

of the Euro 11 for the period up to the end of

2000, the Euro 12 for the period from 2001 to

the end of 2006, and so on. With this approach,

each individual statistical series covers all of the

various compositions of the euro area.

For the HICP, as well as monetary aggregates

and their counterparts, annual rates of change

are compiled from chain-linked indices, with

joining countries’ series linked to the euro

area series in the December index. Thus, if

a country joins the euro area in January of a

given year, annual rates of change relate to the

previous composition of the euro area up to

and including December of the previous year,

and the enlarged composition of the euro area

thereafter. Percentage changes are calculated

on the basis of a chain-linked index, taking

account of the changing composition of the euro

area. Absolute changes for monetary aggregates

and their counterparts (transactions) refer to

GENERAL NOTES

ECB

Monthly Bulletin

May 2011S 86

the composition of the euro area at the time to

which the statistics relate.

Given that the composition of the European

currency unit (ECU) does not coincide with the

former currencies of the countries that have

adopted the single currency, pre-1999 amounts

originally expressed in the participating

currencies and converted into ECU at current

ECU exchange rates are affected by movements

in the currencies of EU Member States that have

not adopted the euro. To avoid this effect on the

monetary statistics, pre-1999 data 1 are expressed

in units converted from national currencies at

the irrevocable euro exchange rates established

on 31 December 1998. Unless otherwise

indicated, price and cost statistics before 1999

are based on data expressed in national

currency terms.

Methods of aggregation and/or consolidation

(including cross-country consolidation) have

been used where appropriate.

Recent data are often provisional and may be

revised. Discrepancies between totals and their

components may arise from rounding.

The group “Other EU Member States” comprises

Bulgaria, the Czech Republic, Denmark, Latvia,

Lithuania, Hungary, Poland, Romania, Sweden

and the United Kingdom.

In most cases, the terminology used within the

tables follows international standards, such

as those contained in the European System

of Accounts 1995 and the IMF Balance

of Payments Manual. Transactions refer to

voluntary exchanges (measured directly or

derived), while fl ows also encompass changes

in outstanding amounts owing to price

and exchange rate changes, write-offs and

other changes.

In the tables, the wording “up to (x) years”

means “up to and including (x) years”.

OVERVIEW

Developments in key indicators for the euro area

are summarised in an overview table.

MONETARY POLICY STATISTICS

Section 1.4 shows statistics on minimum reserve

and liquidity factors. Maintenance periods for

minimum reserve requirements start every month

on the settlement day of the main refi nancing

operation (MRO) following the Governing

Council meeting for which the monthly

assessment of the monetary policy stance is

scheduled. They end on the day preceding the

corresponding settlement day in the following

month. Annual/quarterly observations refer to

averages for the last reserve maintenance period

of the year/quarter.

Table 1 in Section 1.4 shows the components

of the reserve base of credit institutions

subject to reserve requirements. Liabilities

vis-à-vis other credit institutions subject to

the ESCB’s minimum reserve system, the

ECB and participating national central banks

are excluded from the reserve base. When a

credit institution cannot provide evidence of

the amount of its issues of debt securities with

a maturity of up to two years which are held

by the institutions mentioned above, it may

deduct a certain percentage of these liabilities

from its reserve base. The percentage used

to calculate the reserve base was 10% until

November 1999 and has been 30% since

that date.

Table 2 in Section 1.4 contains average data

for completed maintenance periods. First,

the reserve requirement of each individual

Data on monetary statistics in Sections 2.1 to 2.8 are available 1

for periods prior to January 1999 on the ECB’s website

(http://www.ecb.europa.eu/stats/services/downloads/html/index.

en.html) and in the SDW (http://sdw.ecb.europa.eu/browse.

do?node=2018811).

ECB

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May 2011 S 87

EURO AREASTATISTICS

General Notes

credit institution is calculated by applying the

reserve ratios for the corresponding categories

of liability to the eligible liabilities, using the

balance sheet data from the end of each calendar

month. Subsequently, each credit institution

deducts from this fi gure a lump-sum allowance

of €100,000. The resulting required reserves are

then aggregated at the euro area level (column 1).

Current account holdings (column 2) are the

aggregate average daily current account holdings

of credit institutions, including those that serve

to fulfi l reserve requirements. Excess reserves

(column 3) are the average current account

holdings over the maintenance period in excess

of the required reserves. Defi ciencies (column 4)

are defi ned as the average shortfalls of current

account holdings from required reserves over

the maintenance period, computed on the basis

of those credit institutions that have not fulfi lled

their reserve requirements. The interest rate on

minimum reserves (column 5) is equal to the

average, over the maintenance period, of the

ECB’s rate (weighted according to the number

of calendar days) on the Eurosystem’s MROs

(see Section 1.3).

Table 3 in Section 1.4 shows the banking

system’s liquidity position, which is defi ned

as euro area credit institutions’ current account

holdings with the Eurosystem in euro. All

amounts are derived from the consolidated

fi nancial statement of the Eurosystem. Other

liquidity-absorbing operations (column 7)

exclude the issuance of debt certifi cates

initiated by NCBs in Stage Two of EMU. Net

other factors (column 10) represent the netted

remaining items in the consolidated fi nancial

statement of the Eurosystem. Credit institutions’

current accounts (column 11) are equal to

the difference between the sum of liquidity-

providing factors (columns 1 to 5) and the sum

of liquidity-absorbing factors (columns 6 to 10).

Base money (column 12) is calculated as the

sum of the deposit facility (column 6), banknotes

in circulation (column 8) and credit institutions’

current account holdings (column 11).

MONEY, BANKING AND INVESTMENT FUNDS

Section 2.1 shows the aggregated balance sheet

of the monetary fi nancial institution sector,

i.e. the sum of the harmonised balance sheets of

all MFIs resident in the euro area. MFIs comprise

central banks, credit institutions as defi ned

under Community law, money market funds and

other institutions whose business it is to receive

deposits and/or close substitutes for deposits

from entities other than MFIs and, for their own

account (at least in economic terms), to grant

credit and/or make investments in securities.

A complete list of MFIs is published on the

ECB’s website.

Section 2.2 shows the consolidated balance

sheet of the MFI sector, which is obtained by

netting the aggregated balance sheet positions of

MFIs in the euro area. Owing to a small amount

of heterogeneity in recording practices, the sum

of the inter-MFI positions is not necessarily

zero; the balance is shown in column 10 of

the liabilities side of Section 2.2. Section 2.3

sets out the euro area monetary aggregates

and counterparts. These are derived from the

consolidated MFI balance sheet and include

positions of non-MFIs resident in the euro area

held with MFIs resident in the euro area; they

also take account of some monetary assets/

liabilities of central government. Statistics

on monetary aggregates and counterparts are

adjusted for seasonal and trading day effects.

The external liabilities item in Sections 2.1

and 2.2 shows the holdings by non-euro area

residents of: (i) shares/units issued by money

market funds located in the euro area; and

(ii) debt securities issued with a maturity of up

to two years by MFIs located in the euro area.

In Section 2.3, however, these holdings are

excluded from the monetary aggregates and

contribute to the item “net external assets”.

Section 2.4 provides analysis, broken down

by sector, type and original maturity, of loans

granted by MFIs other than the Eurosystem

ECB

Monthly Bulletin

May 2011S 88

(i.e. the banking system) resident in the euro

area. Section 2.5 provides analysis, broken down

by sector and instrument, of deposits held with

the euro area banking system. Section 2.6 shows

the securities held by the euro area banking

system, broken down by type of issuer.

Sections 2.2 to 2.6 include data on transactions,

which are derived as differences in outstanding

amounts adjusted for reclassifi cations,

revaluations, exchange rate variations and any

other changes that do not arise from transactions.

Section 2.7 shows selected revaluations that

are used in the derivation of transactions.

Sections 2.2 to 2.6 also provide growth rates

based on those transactions in the form of

annual percentage changes. Section 2.8 shows a

quarterly currency breakdown of selected MFI

balance sheet items.

Details of sector defi nitions are set out in the

third edition of the “Monetary fi nancial

institutions and markets statistics sector manual –

Guidance for the statistical classifi cation of

customers” (ECB, March 2007). The publication

“Guidance Notes to the Regulation ECB/2001/13

on the MFI Balance Sheet Statistics” (ECB,

November 2002) explains practices that

NCBs are recommended to follow. Since

1 January 1999 statistical information has been

collected and compiled on the basis of various

ECB regulations concerning the balance sheet

of the monetary fi nancial institution sector.

Since July 2010 this has been carried out on

the basis of Regulation ECB/2008/32 2.

In line with this Regulation, the balance sheet

item “money market paper” has been merged

with the item “debt securities” on both the assets

and liabilities sides of the MFI balance sheet.

Section 2.9 shows outstanding amounts and

transactions on the balance sheet of euro area

investment funds (other than money market

funds, which are included in the MFI balance

sheet statistics). An investment fund is a

collective investment undertaking that invests

capital raised from the public in fi nancial and/

or non-fi nancial assets. A complete list of euro

area investment funds is published on the ECB’s

website. The balance sheet is aggregated, so

investment funds' assets include their holdings

of shares/units issued by other investment

funds. Shares/units issued by investment funds

are also broken down by investment policy

(i.e. into bond funds, equity funds, mixed

funds, real estate funds, hedge funds and other

funds) and by type (i.e. into open-end funds and

closed-end funds). Section 2.10 provides further

details on the main types of asset held by euro

area investment funds. This Section contains

a geographical breakdown of the issuers of

securities held by investment funds, as well

as breaking issuers down by economic sector

where they are resident in the euro area.

Further information on these investment fund

statistics can be found in the “Manual on

investment fund statistics”. Since December 2008

harmonised statistical information has been

collected and compiled on the basis of

Regulation ECB/2007/8 concerning statistics on

the assets and liabilities of investment funds.

EURO AREA ACCOUNTS

Section 3.1 shows quarterly integrated euro area

accounts data, which provide comprehensive

information on the economic activities of

households (including non-profi t institutions

serving households), non-fi nancial corporations,

fi nancial corporations and general government,

as well as on the interaction between these

sectors and both the euro area and the rest of the

world. Non-seasonally adjusted data at current

prices are displayed for the last available quarter,

following a simplifi ed sequence of accounts in

accordance with the methodological framework

of the European System of Accounts 1995.

In short, the sequence of accounts (transactions)

comprises: (1) the generation of income account,

which shows how production activity translates

OJ L 15, 20.01.2009, p.14.2

ECB

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May 2011 S 89

EURO AREASTATISTICS

General Notes

into various categories of income; (2) the

allocation of primary income account, which

records receipts and expenses relating to various

forms of property income (for the economy as a

whole; the balancing item of the primary income

account is national income); (3) the secondary

distribution of income account, which shows

how the national income of an institutional

sector changes because of current transfers;

(4) the use of income account, which shows how

disposable income is spent on consumption or

saved; (5) the capital account, which shows how

savings and net capital transfers are spent in the

acquisition of non-fi nancial assets (the balancing

item of the capital account is net lending/

net borrowing); and (6) the fi nancial account,

which records the net acquisitions of fi nancial

assets and the net incurrence of liabilities. As

each non-fi nancial transaction is mirrored by a

fi nancial transaction, the balancing item of the

fi nancial account conceptually also equals net

lending/net borrowing as calculated from the

capital account.

In addition, opening and closing fi nancial

balance sheets are presented, which provide a

picture of the fi nancial wealth of each individual

sector at a given point in time. Finally, other

changes in fi nancial assets and liabilities

(e.g. those resulting from the impact of changes

in asset prices) are also shown.

The sectoral coverage of the fi nancial account

and the fi nancial balance sheets is more detailed

for the fi nancial corporation sector, which

is broken down into MFIs, other fi nancial

intermediaries (including fi nancial auxiliaries),

and insurance corporations and pension funds.

Section 3.2 shows four-quarter cumulated fl ows

(transactions) for the “non-fi nancial accounts”

of the euro area (i.e. accounts (1) to (5) above),

also following the simplifi ed sequence of

accounts.

Section 3.3 shows four-quarter cumulated fl ows

(transactions and other changes) for households’

income, expenditure and accumulation accounts,

as well as outstanding amounts in the fi nancial

and non-fi nancial balance sheet accounts,

presenting data in a more analytical manner.

Sector-specifi c transactions and balancing

items are arranged in a way that more clearly

depicts the fi nancing and investment decisions

of households, while respecting the accounting

identities presented in Sections 3.1 and 3.2.

Section 3.4 displays four-quarter cumulated fl ows

(transactions) for non-fi nancial corporations’

income and accumulation accounts, as well as

outstanding amounts for the fi nancial balance

sheet accounts, presenting data in a more

analytical manner.

Section 3.5 shows four-quarter cumulated

fi nancial fl ows (transactions and other changes)

and outstanding amounts for the fi nancial

balance sheets of insurance corporations and

pension funds.

FINANCIAL MARKETS

The series on fi nancial market statistics for the

euro area cover those EU Member States that

had adopted the euro at the time to which the

statistics relate (i.e. a changing composition),

with the exception of statistics on securities

issues (Sections 4.1 to 4.4), which relate to the

Euro 16 for the whole time series (i.e. a fi xed

composition).

Statistics on securities other than shares and

statistics on quoted shares (Sections 4.1 to

4.4) are produced by the ECB using data from

the ESCB and the BIS. Section 4.5 presents

MFI interest rates on euro-denominated

deposits from and loans to euro area residents.

Statistics on money market interest rates, long-

term government bond yields and stock market

indices (Sections 4.6 to 4.8) are produced by

the ECB using data from wire services.

Statistics on securities issues cover: (i) securities

other than shares, excluding fi nancial derivatives;

and (ii) quoted shares. The former are presented

ECB

Monthly Bulletin

May 2011S 90

in Sections 4.1, 4.2 and 4.3, while the latter

are presented in Section 4.4. Debt securities

are broken down into short-term and long-term

securities. “Short-term” means securities with an

original maturity of one year or less (in exceptional

cases, two years or less). Securities with

(i) a longer maturity, (ii) optional maturity dates,

the latest of which is more than one year away,

or (iii) indefi nite maturity dates are classifi ed as

“long-term”. Long-term debt securities issued

by euro area residents are broken down further

into fi xed and variable rate issues. Fixed rate

issues consist of issues where the coupon

rate does not change during the life of the

issue. Variable rate issues comprise all issues

where the coupon is periodically refi xed with

reference to an independent interest rate or index.

The euro-denominated securities indicated in

Sections 4.1, 4.2 and 4.3 also include items

expressed in national denominations of the euro.

Section 4.1 shows securities other than shares,

broken down by original maturity, residency of

the issuer and currency. It presents outstanding

amounts, gross issues and net issues of

securities other than shares, broken down into:

(i) issues denominated in euro and issues in all

currencies; (ii) issues by euro area residents

and total issues; and (iii) total and long-term

maturities. Net issues differ from the changes

in outstanding amounts owing to valuation

changes, reclassifi cations and other adjustments.

This section also presents seasonally adjusted

statistics, including six-month annualised

seasonally adjusted growth rates for total and

long-term debt securities. Seasonally adjusted

data are derived from the index of notional

stocks, from which the seasonal effects have

been removed. See the Technical Notes for

details.

Section 4.2 contains a sectoral breakdown

of outstanding amounts, gross issues and net

issues for issuers resident in the euro area in line

with the ESA 95. The ECB is included in the

Eurosystem.

The total outstanding amounts for total and

long-term debt securities in column 1 of Table 1 in

Section 4.2 correspond to the data on outstanding

amounts for total and long-term debt securities

issued by euro area residents in column 7 of

Section 4.1. The outstanding amounts for total

and long-term debt securities issued by MFIs in

column 2 of Table 1 in Section 4.2 are broadly

comparable with the data on debt securities issued

on the liabilities side of the aggregated MFI

balance sheet in column 8 of Table 2 in Section 2.1.

The total net issues for total debt securities in

column 1 of Table 2 in Section 4.2 correspond to

the data on total net issues by euro area residents

in column 9 of Section 4.1. The residual difference

between long-term debt securities and total fi xed

and variable rate long-term debt securities in

Table 1 of Section 4.2 consists of zero coupon

bonds and revaluation effects.

Section 4.3 shows seasonally adjusted and

non-seasonally adjusted growth rates for debt

securities issued by euro area residents (broken

down by maturity, type of instrument, sector

of the issuer and currency), which are based

on fi nancial transactions that occur when an

institutional unit incurs or redeems liabilities. The

growth rates therefore exclude reclassifi cations,

revaluations, exchange rate variations and any

other changes that do not arise from transactions.

The seasonally adjusted growth rates have been

annualised for presentational purposes. See the

Technical Notes for details.

Columns 1, 4, 6 and 8 in Table 1 of Section 4.4

show the outstanding amounts of quoted shares

issued by euro area residents broken down by

issuing sector. The monthly data for quoted

shares issued by non-fi nancial corporations

correspond to the quarterly series shown in

Section 3.4 (fi nancial balance sheet; quoted

shares).

Columns 3, 5, 7 and 9 in Table 1 of Section 4.4

show annual growth rates for quoted shares

issued by euro area residents (broken down by

the sector of the issuer), which are based on

fi nancial transactions that occur when an issuer

issues or redeems shares for cash, excluding

investments in the issuer’s own shares.

The calculation of annual growth rates excludes

ECB

Monthly Bulletin

May 2011 S 91

EURO AREASTATISTICS

General Notes

reclassifi cations, revaluations and any other

changes that do not arise from transactions.

Section 4.5 presents statistics on all the interest

rates that MFIs resident in the euro area apply

to euro-denominated deposits and loans vis-à-vis

households and non-fi nancial corporations

resident in the euro area. Euro area MFI

interest rates are calculated as a weighted

average (by corresponding business volume) of

the euro area countries’ interest rates for each

category.

MFI interest rate statistics are broken down by

type of business coverage, sector, instrument

category and maturity, period of notice or initial

period of interest rate fi xation. These MFI

interest rate statistics replaced the ten transitional

statistical series on euro area retail interest rates

that had been published in the Monthly Bulletin

as of January 1999.

Section 4.6 presents money market interest rates

for the euro area, the United States and Japan.

For the euro area, a broad spectrum of money

market interest rates is covered, ranging from

interest rates on overnight deposits to those on

twelve-month deposits. Before January 1999,

synthetic euro area interest rates were calculated

on the basis of national rates weighted by

GDP. With the exception of the overnight rate

prior to January 1999, monthly, quarterly and

yearly values are period averages. Overnight

deposits are represented by end-of-period

interbank deposit bid rates up to and including

December 1998 and period averages for the euro

overnight index average (EONIA) thereafter.

As of January 1999, euro area interest rates on

one, three, six and twelve-month deposits are

euro interbank offered rates (EURIBOR); prior

to that date, they are London interbank offered

rates (LIBOR) where available. For the United

States and Japan, interest rates on three-month

deposits are represented by LIBOR.

Section 4.7 shows end-of-period rates estimated

from nominal spot yield curves based on

AAA-rated euro-denominated bonds issued by

euro area central governments. The yield curves

are estimated using the Svensson model 3.

Spreads between the ten-year rates and the three-

month and two-year rates are also released.

Additional yield curves (daily releases, including

charts and tables) and the corresponding

methodological information are available at:

http://www.ecb.europa.eu/stats/money/yc/html/

index.en.html. Daily data can also be

downloaded.

Section 4.8 shows stock market indices for the

euro area, the United States and Japan.

PRICES, OUTPUT, DEMAND AND LABOUR MARKETS

Most of the data described in this section are

produced by the European Commission (mainly

Eurostat) and national statistical authorities. Euro

area results are obtained by aggregating data

for individual countries. As far as possible, the

data are harmonised and comparable. Statistics

on labour costs indices, GDP and expenditure

components, value added by economic activity,

industrial production, retail sales passenger car

registrations and employment in terms of hours

worked are working day-adjusted.

The Harmonised Index of Consumer Prices

(HICP) for the euro area (Table 1 in Section 5.1)

is available from 1995 onwards. It is based

on national HICPs, which follow the same

methodology in all euro area countries. The

breakdown into goods and services components

is derived from the classifi cation of individual

consumption by purpose (Coicop/HICP).

The HICP covers monetary expenditure by

households on fi nal consumption in the economic

territory of the euro area. The table includes

seasonally adjusted HICP data and experimental

HICP-based estimates of administered prices,

which are compiled by the ECB.

Svensson, L. E., “Estimating and Interpreting Forward Interest 3

Rates: Sweden 1992-1994”, Centre for Economic Policy

Research, Discussion Paper No 1051, 1994.

ECB

Monthly Bulletin

May 2011S 92

Industrial producer prices (Table 2 in

Section 5.1), industrial production, industrial

new orders, industrial turnover and retail sales

(Section 5.2) are covered by Council Regulation

(EC) No 1165/98 of 19 May 1998 concerning

short-term statistics4. Since January 2009 the

revised classifi cation of economic activities

(NACE Revision 2), as covered by Regulation

(EC) No 1893/2006 of the European Parliament

and of the Council of 20 December 2006

establishing the statistical classifi cation

of economic activities NACE Revision 2 and

amending Council Regulation (EEC)

No 3037/90, as well as certain EC Regulations

on specifi c statistical domains,5 has been applied

in the production of short-term statistics. The

breakdown by end-use of product for industrial

producer prices and industrial production is the

harmonised sub-division of industry excluding

construction (NACE Revision 2, sections B

to E) into Main Industrial Groupings (MIGs)

as defi ned by Commission Regulation (EC)

No 656/2007 of 14 June 2007 6. Industrial

producer prices refl ect the ex-factory gate prices

of producers. They include indirect taxes except

VAT and other deductible taxes. Industrial

production refl ects the value added of the

industries concerned.

The two non-energy commodity price indices

shown in Table 3 in Section 5.1 are compiled

with the same commodity coverage, but using

two different weighting schemes: one based on

the respective commodity imports of the euro

area (columns 2-4), and the other (columns 5-7)

based on estimated euro area domestic demand,

or “use”, taking into account information on

imports, exports and the domestic production

of each commodity (ignoring, for the sake of

simplicity, inventories, which are assumed to

be relatively stable over the observed period).

The import-weighted commodity price index is

appropriate for analysing external developments,

while the use-weighted index is suitable for

the specifi c purpose of analysing international

commodity price pressures on euro area infl ation.

The use-weighted commodity price indices are

experimental data. For more details as regards

the compilation of the ECB commodity price

indices, see Box 1 in the December 2008 issue

of the Monthly Bulletin.

The labour cost indices (Table 5 in Section 5.1)

measure the changes in labour costs per hour

worked in industry (including construction)

and market services. Their methodology is

laid down in Regulation (EC) No 450/2003

of the European Parliament and of the

Council of 27 February 2003 concerning the

labour cost index 7 and in the implementing

Commission Regulation (EC) No 1216/2003

of 7 July 2003 8. A breakdown of the labour

cost indices for the euro area is available by

labour cost component (wages and salaries,

and employers’ social contributions plus

employment-related taxes paid by the employer

less subsidies received by the employer) and by

economic activity. The ECB calculates the

indicator of negotiated wages (memo item

in Table 3 of Section 5.1) on the basis of

non-harmonised, national-defi nition data.

Unit labour cost components (Table 4 in

Section 5.1), GDP and its components (Tables 1

and 2 in Section 5.2), GDP defl ators (Table 3

in Section 5.1) and employment statistics

(Tables 1, 2 and 3 in Section 5.3) are derived

from the ESA 95 quarterly national accounts.

Industrial new orders (Table 4 in Section 5.2)

measure the orders received during the reference

period and cover industries working mainly on

the basis of orders – in particular the textile, pulp

and paper, chemical, metal, capital goods and

durable consumer goods industries. The data are

calculated on the basis of current prices.

Indices for turnover in industry and for the

retail trade (Table 4 in Section 5.2) measure

the turnover, including all duties and taxes

(with the exception of VAT), invoiced during

the reference period. Retail trade turnover

covers all retail trade (excluding sales of motor

OJ L 162, 5.6.1998, p. 1.4

OJ L 393, 30.12.2006, p. 1.5

OJ L 155, 15.6.2007, p. 3.6

OJ L 69, 13.3.2003, p. 1.7

OJ L 169, 8.7.2003, p. 37.8

ECB

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May 2011 S 93

EURO AREASTATISTICS

General Notes

vehicles and motorcycles), except automotive

fuel. New passenger car registrations cover

registrations of both private and commercial

passenger cars.

Qualitative business and consumer survey data

(Table 5 in Section 5.2) draw on the European

Commission Business and Consumer Surveys.

Unemployment rates (Table 4 in Section 5.3)

conform to International Labour Organization

guidelines. They refer to persons actively

seeking work as a share of the labour force,

using harmonised criteria and defi nitions.

The labour force estimates underlying the

unemployment rate are different from the sum

of the employment and unemployment levels

published in Section 5.3.

GOVERNMENT FINANCE

Sections 6.1 to 6.5 show the general government

fi scal position in the euro area. The data are

mainly consolidated and are based on the

ESA 95 methodology. The annual euro area

aggregates in Sections 6.1 to 6.3 are compiled

by the ECB on the basis of harmonised data

provided by the NCBs, which are regularly

updated. The defi cit and debt data for the euro

area countries may therefore differ from those

used by the European Commission within the

excessive defi cit procedure. The quarterly euro

area aggregates in Sections 6.4 and 6.5 are

compiled by the ECB on the basis of Eurostat

and national data.

Section 6.1 presents annual fi gures on general

government revenue and expenditure on the

basis of defi nitions laid down in Commission

Regulation (EC) No 1500/2000 of 10 July 2000 9

amending the ESA 95. Section 6.2 shows details

of general government gross consolidated debt

at nominal value in line with the Treaty

provisions on the excessive defi cit procedure.

Sections 6.1 and 6.2 include summary data for

the individual euro area countries owing to

their importance within the framework of the

Stability and Growth Pact. The defi cits/surpluses

presented for the individual euro area countries

correspond to excessive defi cit procedure B.9,

as defi ned by Council Regulation (EC)

No 479/2009 as regards references to the

ESA 95. Section 6.3 presents changes in general

government debt. The difference between the

change in the government debt and the

government defi cit – the defi cit-debt adjustment –

is mainly explained by government transactions

in fi nancial assets and by foreign exchange

valuation effects. Section 6.4 presents quarterly

fi gures on general government revenue and

expenditure on the basis of defi nitions laid down

in Regulation (EC) No 1221/2002 of the

European Parliament and of the Council of

10 June 2002 on quarterly non-fi nancial accounts

for general government 10. Section 6.5 presents

quarterly fi gures on gross consolidated

government debt, the defi cit-debt adjustment

and the government borrowing requirement.

These fi gures are compiled using data provided

by the Member States under Regulation (EC)

No 501/2004 and Regulation (EC) No 222/2004

and data provided by the NCBs.

EXTERNAL TRANSACTIONS AND POSITIONS

The concepts and defi nitions used in balance

of payments and international investment

position (i.i.p.) statistics (Sections 7.1 to 7.4)

are generally in line with the IMF Balance of

Payments Manual (fi fth edition, October 1993),

the ECB Guideline of 16 July 2004 on the

statistical reporting requirements of the ECB

(ECB/2004/15)11 and the amending ECB

Guideline of 31 May 2007 (ECB/2007/3) 12.

Additional information regarding the

methodologies and sources used in the euro

area b.o.p. and i.i.p. statistics can be found in

the ECB publication entitled “European Union

balance of payments/international investment

position statistical methods” (May 2007) and

in the reports of the Task Force on Portfolio

Investment Collection Systems (June 2002),

OJ L 172, 12.7.2000, p. 3. 9

OJ L 179, 9.7.2002, p. 1.10

OJ L 354, 30.11.2004, p. 34.11

OJ L 159, 20.6.2007, p. 48.12

ECB

Monthly Bulletin

May 2011S 94

the Task Force on Portfolio Investment Income

(August 2003) and the Task Force on Foreign

Direct Investment (March 2004), all of which

can be downloaded from the ECB’s website.

In addition, a report by the ECB/European

Commission (Eurostat) Task Force on Quality

looking at balance of payments and international

investment position statistics (June 2004) is

available on the website of the Committee on

Monetary, Financial and Balance of Payments

Statistics (www.cmfb.org). The annual quality

report on the euro area b.o.p./i.i.p., which is

based on the Task Force’s recommendations and

follows the basic principles of the ECB Statistics

Quality Framework published in April 2008, is

available on the ECB’s website.

The tables in Sections 7.1 and 7.4 follow

the sign convention in the IMF Balance of

Payments Manual – i.e. surpluses in the current

account and the capital account have a plus

sign, while in the fi nancial account a plus sign

denotes an increase in liabilities or a decrease

in assets. In the tables in Section 7.2, both credit

and debit transactions are presented with a plus

sign. Furthermore, as of the February 2008

issue of the Monthly Bulletin, the tables in

Section 7.3 have been restructured in order to

allow the data on the balance of payments, the

international investment position and related

growth rates to be presented together; in the new

tables, transactions in assets and liabilities that

correspond to increases in positions are shown

with a plus sign.

The euro area b.o.p. is compiled by the ECB.

Recent monthly fi gures should be regarded as

provisional. Data are revised when fi gures for

the following month and/or the detailed quarterly

b.o.p. are published. Earlier data are revised

periodically or as a result of methodological

changes in the compilation of the source data.

Table 1 in Section 7.2 also contains seasonally

adjusted data for the current account. Where

appropriate, the adjustment also covers working

day, leap year and/or Easter-related effects.

Table 3 in Section 7.2 and Table 9 in Section 7.3

present a breakdown of the euro area b.o.p. and

i.i.p. vis-à-vis major partner countries, both

individually and as a group, distinguishing

between EU Member States outside the euro

area and countries or areas outside the European

Union. The breakdown also shows transactions

and positions vis-à-vis EU institutions (which,

with the exception of the ECB, are considered

to be outside the euro area for statistical

purposes, regardless of their physical location)

and, for some purposes, offshore centres and

international organisations. The breakdown does

not cover transactions or positions in portfolio

investment liabilities, fi nancial derivatives or

international reserves. In addition, separate data

are not provided for investment income payable

to Brazil, mainland China, India or Russia. The

geographical breakdown is described in the

article entitled “Euro area balance of payments

and international investment position vis-à-vis

main counterparts” in the February 2005 issue

of the Monthly Bulletin.

The data on the euro area b.o.p. fi nancial account

and i.i.p. in Section 7.3 are based on transactions

and positions vis-à-vis non-residents of the euro

area, regarding the euro area as a single economic

entity (see also Box 9 in the December 2002

issue of the Monthly Bulletin, Box 5 in the

January 2007 issue of the Monthly Bulletin and

Box 6 in the January 2008 issue of the Monthly

Bulletin). The i.i.p. is valued at current market

prices, with the exception of direct investment,

where book values are used for unquoted shares,

and other investments (e.g. loans and deposits).

The quarterly i.i.p. is compiled on the basis of the

same methodological framework as the annual

i.i.p. As some data sources are not available on

a quarterly basis (or are available with a delay),

the quarterly i.i.p. is partly estimated on the

basis of fi nancial transactions, asset prices and

foreign exchange developments.

Table 1 in Section 7.3 summarises the i.i.p.

and fi nancial transactions in the euro area

b.o.p. The breakdown of the change in

the annual i.i.p. is obtained by applying

a statistical model to i.i.p. changes other

than transactions, using information from

the geographical breakdown and currency

ECB

Monthly Bulletin

May 2011 S 95

EURO AREASTATISTICS

General Notes

composition of assets and liabilities, as well

as price indices for different fi nancial assets.

In this table, columns 5 and 6 refer to direct

investment by resident units abroad and direct

investment by non-resident units in the euro

area.

In Table 5 in Section 7.3, the breakdown into

“loans” and “currency and deposits” is based

on the sector of the non-resident counterpart –

i.e. assets vis-à-vis non-resident banks are

classifi ed as deposits, whereas assets vis-à-vis

other non-resident sectors are classifi ed as loans.

This breakdown follows the distinction made in

other statistics, such as the MFI consolidated

balance sheet, and conforms to the IMF Balance

of Payments Manual.

The outstanding amounts for the Eurosystem’s

international reserves and related assets and

liabilities are shown in Table 7 of Section 7.3.

These fi gures are not fully comparable with

those in the Eurosystem’s weekly fi nancial

statement owing to differences in coverage

and valuation. The data in Table 7 are in line

with the recommendations for the template on

international reserves and foreign currency

liquidity. By defi nition, the assets included in

the Eurosystem’s international reserves take

account of the changing composition of the

euro area. Before countries join the euro area,

the assets of their national central banks are

included in portfolio investment (in the case of

securities) or other investment (in the case of

other assets). Changes in the gold holdings of the

Eurosystem (column 3) are due to transactions

in gold within the terms of the Central Bank

Gold Agreement of 26 September 1999, which

was updated on 27 September 2009. More

information on the statistical treatment of the

Eurosystem’s international reserves can be found

in a publication entitled “Statistical treatment

of the Eurosystem’s international reserves”

(October 2000), which can be downloaded from

the ECB’s website. The website also contains

more comprehensive data in accordance with the

template on international reserves and foreign

currency liquidity.

The euro area’s gross external debt statistics

in Table 8 of Section 7.3 represent outstanding

actual (rather than contingent) liabilities vis-à-vis

non-euro area residents that require the payment

of principal and/or interest by the debtor at one

or more points in the future. Table 8 shows a

breakdown of gross external debt by instrument

and institutional sector.

Section 7.4 contains a monetary presentation

of the euro area balance of payments, showing

the transactions by non-MFIs that mirror the net

external transactions by MFIs. Included in the

transactions by non-MFIs are b.o.p. transactions

for which a sectoral breakdown is not available.

These concern the current and capital accounts

(column 2) and fi nancial derivatives (column 11).

An up-to-date methodological note on the

monetary presentation of the euro area balance

of payments is available in the “Statistics”

section of the ECB’s website. See also Box 1 in

the June 2003 issue of the Monthly Bulletin.

Section 7.5 shows data on euro area external

trade in goods. The source is Eurostat. Value data

and volume indices are seasonally and working

day-adjusted. The breakdown by product

group in columns 4 to 6 and 9 to 11 of Table 1

in Section 7.5 is in line with the classifi cation

contained in the Broad Economic Categories

and corresponds to the basic classes of goods in

the System of National Accounts. Manufactured

goods (columns 7 and 12) and oil (column 13)

are in line with the SITC Rev. 4 defi nition. The

geographical breakdown (Table 3 in Section 7.5)

shows major trading partners both individually

and in regional groups. China excludes Hong

Kong. On account of differences in defi nitions,

classifi cation, coverage and time of recording,

external trade data, in particular for imports, are

not fully comparable with the goods item in the

b.o.p. statistics (Sections 7.1 and 7.2). Part of the

difference arises from the inclusion of insurance

and freight services in the recording of imported

goods in external trade data.

Industrial import prices and industrial producer

export prices (or industrial output prices for

ECB

Monthly Bulletin

May 2011S 96

the non-domestic market) shown in Table 2

in Section 7.5 were introduced by Regulation

(EC) No 1158/2005 of the European Parliament

and of the Council of 6 July 2005 amending

Council Regulation (EC) No 1165/98, which is

the principal legal basis for short-term statistics.

The industrial import price index covers

industrial products imported from outside the

euro area under sections B to E of the Statistical

Classifi cation of Products by Activity in the

European Economic Community (CPA) and all

institutional import sectors except households,

governments and non-profi t institutions. It

refl ects the cost, insurance and freight price

excluding import duties and taxes, and refers to

actual transactions in euro recorded at the point

when ownership of the goods is transferred.

The industrial producer export prices cover all

industrial products exported directly by euro

area producers to the extra-euro area market

under sections B to E of NACE Revision 2.

Exports from wholesalers and re-exports are

not covered. The indices refl ect the free on

board price expressed in euro and calculated

at the euro area frontier, including any indirect

taxes except VAT and other deductible taxes.

Industrial import prices and industrial producer

export prices are available by Main Industrial

Grouping as defi ned by Commission Regulation

(EC) No 656/2007 of 14 June 2007. For more

details, see Box 11 in the December 2008 issue

of the Monthly Bulletin.

EXCHANGE RATES

Section 8.1 shows nominal and real effective

exchange rate indices for the euro, which are

calculated by the ECB on the basis of weighted

averages of the euro’s bilateral exchange rates

against the currencies of the selected trading

partners of the euro area. A positive change

denotes an appreciation of the euro. Weights

are based on trade in manufactured goods with

those trading partners in the periods 1995-1997,

1998-2000, 2001-2003 and 2004-2006, and are

calculated to account for third-market effects.

The EER indices are obtained by chain-linking

the indicators based on each of these four sets

of trade weights at the end of each three-year

period. The base period of the resulting EER

index is the fi rst quarter of 1999. The EER-20

group of trading partners is composed of the

10 non-euro area EU Member States plus

Australia, Canada, China, Hong Kong, Japan,

Norway, Singapore, South Korea, Switzerland

and the United States. The EER-40 group

comprises the EER-20 plus the following

countries: Algeria, Argentina, Brazil, Chile,

Croatia, Iceland, India, Indonesia, Israel,

Malaysia, Mexico, Morocco, New Zealand,

the Philippines, Russia, South Africa, Taiwan,

Thailand, Turkey and Venezuela. Real EERs

are calculated using consumer price indices,

producer price indices, gross domestic product

defl ators and unit labour costs, both for the

manufacturing sector and for the total economy.

For more detailed information on the calculation

of the EERs, see the relevant methodological note

and ECB Occasional Paper No 2 (“The effective

exchange rates of the euro” by Luca Buldorini,

Stelios Makrydakis and Christian Thimann,

February 2002), which can be downloaded from

the ECB’s website.

The bilateral rates shown in Section 8.2 are

monthly averages of those published daily as

reference rates for these currencies.

DEVELOPMENTS OUTSIDE THE EURO AREA

Statistics on other EU Member States

(Section 9.1) follow the same principles as data

relating to the euro area. As a result, data on

current and capital accounts and gross external

debt include special-purpose vehicles. The data

for the United States and Japan contained in

Section 9.2 are obtained from national sources.

ECB

Monthly Bulletin

May 2011

15 JANUARY 2009

The Governing Council of the ECB decides

to decrease the interest rate on the main

refi nancing operations by 50 basis points

to 2.00%, starting from the operations to

be settled on 21 January 2009. In addition,

it decides that the interest rates on the marginal

lending and the deposit facility will be 3.00%

and 1.00% respectively, with effect from

21 January 2009, in line with the decision of

18 December 2008.

5 FEBRUARY 2009

The Governing Council of the ECB decides

that the interest rate on the main refi nancing

operations and the interest rates on the marginal

lending facility and the deposit facility will

remain unchanged at 2.00%, 3.00% and 1.00%

respectively.

5 MARCH 2009

The Governing Council of the ECB decides

to decrease the interest rate on the main

refi nancing operations by 50 basis points

to 1.50%, starting from the operations to

be settled on 11 March 2009. In addition, it

decides that the interest rates on the marginal

lending and the deposit facility will be 2.50%

and 0.50% respectively, with effect from

11 March 2009.

Moreover, the Governing Council decides

to continue the fi xed rate tender procedure

with full allotment for all main refi nancing

operations, special-term refi nancing operations

and supplementary and regular longer-term

refi nancing operations for as long as needed,

and in any case beyond the end of 2009. In

addition, the Governing Council decides

to continue with the current frequency and

maturity profi le of supplementary longer-

term refi nancing operations and special-term

refi nancing operations for as long as needed,

and in any case beyond the end of 2009.

2 APRIL 2009

The Governing Council of the ECB decides

to decrease the interest rate on the main

refi nancing operations by 25 basis points to

1.25%, starting from the operations to be settled

on 8 April 2009. In addition, it decides that

the interest rates on the marginal lending and

the deposit facility will be 2.25% and 0.25%

respectively, with effect from 8 April 2009.

7 MAY 2009

The Governing Council of the ECB decides to

decrease the interest rate on the main refi nancing

operations by 25 basis points to 1.00%, starting

from the operation to be settled on 13 May 2009.

In addition, it decides to decrease the interest rate

on the marginal lending facility by 50 basis points

to 1.75% with effect from 13 May 2009, and

to leave the interest rate on the deposit facility

unchanged at 0.25%. In addition, the Governing

Council of the ECB decides to proceed with its

enhanced credit support approach. In particular,

it decides that the Eurosystem will conduct

liquidity-providing longer-term refi nancing

operations with a maturity of one year as fi xed rate

tender procedure with full allotment. In addition,

it decides in principle that the Eurosystem will

purchase euro-denominated covered bonds issued

in the euro area.

4 JUNE 2009

The Governing Council of the ECB decides

that the interest rate on the main refi nancing

operations and the interest rates on the marginal

lending facility and the deposit facility will

remain unchanged at 1.00%, 1.75% and 0.25%

respectively. In addition, the Governing Council

of the ECB decides upon the technical modalities

related to the purchase of euro-denominated

covered bonds issued in the euro area decided

on 7 May 2009.

I

ANNEXES

CHRONOLOGY OF MONETARY POLICY MEASURES OF THE EUROSYSTEM1

The chronology of monetary policy measures taken by the 1

Eurosystem between 1999 and 2008 can be found in the ECB’s

Annual Report for the respective years.

ECB

Monthly Bulletin

May 2011II

2 JULY, 6 AUGUST, 3 SEPTEMBER, 8 OCTOBER

AND 5 NOVEMBER 2009

The Governing Council of the ECB decides

that the interest rate on the main refi nancing

operations and the interest rates on the marginal

lending facility and the deposit facility will

remain unchanged at 1.00%, 1.75% and 0.25%

respectively.

3 DECEMBER 2009

The Governing Council of the ECB decides

that the interest rate on the main refi nancing

operations and the interest rates on the marginal

lending facility and the deposit facility will

remain unchanged at 1.00%, 1.75% and 0.25%

respectively. It also decides on the details as

regards the tender procedures and modalities

to be applied in its refi nancing operations up to

13 April 2010.

14 JANUARY AND 4 FEBRUARY 2010

The Governing Council of the ECB decides

that the interest rate on the main refi nancing

operations and the interest rates on the marginal

lending facility and the deposit facility will

remain unchanged at 1.00%, 1.75% and 0.25%

respectively.

4 MARCH 2010

The Governing Council of the ECB decides

that the interest rate on the main refi nancing

operations and the interest rates on the marginal

lending facility and the deposit facility will

remain unchanged at 1.00%, 1.75% and 0.25%

respectively. It also decides on the details as

regards the tender procedures and modalities

to be applied in its refi nancing operations

up to 12 October 2010, including a return to

variable rate tender procedures in the regular

three-month longer-term refi nancing operations,

starting with the operation to be allotted

on 28 April 2010.

8 APRIL AND 6 MAY 2010

The Governing Council of the ECB decides

that the interest rate on the main refi nancing

operations and the interest rates on the marginal

lending facility and the deposit facility will

remain unchanged at 1.00%, 1.75% and 0.25%

respectively.

10 MAY 2010

The Governing Council of the ECB decides

on several measures to address severe tensions

in fi nancial markets. In particular, it decides

to conduct interventions in the euro area

public and private debt securities markets

(Securities Markets Programme) and to adopt a

fi xed rate tender procedure with full allotment in

the regular three-month longer-term refi nancing

operations in May and June 2010.

10 JUNE 2010

The Governing Council of the ECB decides that the

interest rate on the main refi nancing operations and

the interest rates on the marginal lending facility

and the deposit facility will remain unchanged at

1.00%, 1.75% and 0.25% respectively. In addition,

it decides to adopt a fi xed rate tender procedure

with full allotment in the regular three-month

longer-term refi nancing operations to be allotted

during the third quarter of 2010.

8 JULY AND 5 AUGUST 2010

The Governing Council of the ECB decides that the

interest rate on the main refi nancing operations and

the interest rates on the marginal lending facility

and the deposit facility will remain unchanged at

1.00%, 1.75% and 0.25% respectively.

2 SEPTEMBER 2010

The Governing Council of the ECB decides

that the interest rate on the main refi nancing

ECB

Monthly Bulletin

May 2011

CHRONOLOGY

III

operations and the interest rates on the marginal

lending facility and the deposit facility will

remain unchanged at 1.00%, 1.75% and 0.25%

respectively. It also decides on the details as

regards the tender procedures and modalities

to be applied in its refi nancing operations up

to 11 January 2011, notably the adoption of

a fi xed rate tender procedure with full allotment

in the three-month longer-term refi nancing

operations.

7 OCTOBER AND 4 NOVEMBER 2010

The Governing Council of the ECB decides

that the interest rate on the main refi nancing

operations and the interest rates on the marginal

lending facility and the deposit facility will

remain unchanged at 1.00%, 1.75% and 0.25%

respectively.

2 DECEMBER 2010

The Governing Council of the ECB decides

that the interest rate on the main refi nancing

operations and the interest rates on the marginal

lending facility and the deposit facility will

remain unchanged at 1.00%, 1.75% and 0.25%

respectively. It also decides on the details as

regards the tender procedures and modalities

to be applied in its refi nancing operations up to

12 April 2011, notably to continue its fi xed rate

tender procedures with full allotment.

13 JANUARY AND 3 FEBRUARY 2011

The Governing Council of the ECB decides

that the interest rate on the main refi nancing

operations and the interest rates on the marginal

lending facility and the deposit facility will

remain unchanged at 1.00%, 1.75% and 0.25%

respectively.

3 MARCH 2011

The Governing Council of the ECB decides

that the interest rate on the main refi nancing

operations and the interest rates on the marginal

lending facility and the deposit facility will

remain unchanged at 1.00%, 1.75% and 0.25%

respectively. It also decides on the details as

regards the tender procedures and modalities

to be applied in its refi nancing operations up to

12 July 2011, notably to continue its fi xed rate

tender procedures with full allotment.

7 APRIL 2011

The Governing Council of the ECB decides to

increase the interest rate on the main refi nancing

operations by 25 basis points to 1.25%, starting

from the operation to be settled on 13 April 2011.

In addition, it decides to increase the interest

rates on both the marginal lending facility and

the deposit facility by 25 basis points, to 2.00%

and 0.50% respectively, both with effect from

13 April 2011.

5 MAY 2011

The Governing Council of the ECB decides

that the interest rate on the main refi nancing

operations and the interest rates on the marginal

lending facility and the deposit facility will

remain unchanged at 1.25%, 2.00% and 0.50%

respectively.

IV

ECB

Monthly Bulletin

May 2011 V

The ECB produces a number of publications which provide information about its core activities:

monetary policy, statistics, payment and securities settlement systems, fi nancial stability and

supervision, international and European cooperation, and legal matters. These include the

following:

STATUTORY PUBLICATIONS

Annual Report –

Convergence Report –

Monthly Bulletin –

RESEARCH PAPERS

Legal Working Paper Series –

Occasional Paper Series –

Research Bulletin –

Working Paper Series –

OTHER/TASK-RELATED PUBLICATIONS

Enhancing monetary analysis –

Financial integration in Europe –

Financial Stability Review –

Statistics Pocket Book –

The European Central Bank: history, role and functions –

The international role of the euro –

The implementation of monetary policy in the euro area (“General Documentation”) –

The monetary policy of the ECB –

The payment system –

The ECB also publishes brochures and information materials on a variety of topics, such as the euro

banknotes and coins, as well as seminar and conference proceedings.

For a complete list of documents (in PDF format) published by the ECB and the European

Monetary Institute, the ECB’s forerunner from 1994 to 1998, please visit the ECB’s website at

http://www.ecb.europa.eu/pub/. Language codes indicate the languages in which each publication

is available.

Unless otherwise indicated, hard copies can be obtained or subscribed to free of charge, stock

permitting, by contacting info@ecb.europa.eu

PUBLICATIONS PRODUCED BY THE EUROPEAN CENTRAL BANK

ECB

Monthly Bulletin

May 2011

GLOSSARY

This glossary contains selected items that are frequently used in the Monthly Bulletin. A more

comprehensive and detailed glossary can be found on the ECB’s website (www.ecb.europa.eu/

home/glossary/html/index.en.html).

Autonomous liquidity factors: liquidity factors that do not normally stem from the use of monetary

policy instruments. Such factors are, for example, banknotes in circulation, government deposits

with the central bank and the net foreign assets of the central bank.

Balance of payments (b.o.p.): a statistical statement that summarises, for a specifi c period of

time, the economic transactions of an economy with the rest of the world.

Bank lending survey (BLS): a quarterly survey on lending policies that has been conducted by

the Eurosystem since January 2003. It addresses qualitative questions on developments in credit

standards, terms and conditions of loans and loan demand for both enterprises and households to a

predefi ned sample group of banks in the euro area.

Borrowing requirement (general government): net incurrence of debt by the general government.

Break-even inflation rate: the spread between the yield on a nominal bond and that on an infl ation-

linked bond of the same (or as similar as possible) maturity.

Capital account: a b.o.p. account that covers all capital transfers and acquisitions/disposals of

non-produced, non-fi nancial assets between residents and non-residents.

Capital accounts: part of the system of national (or euro area) accounts consisting of the change in

net worth that is due to net saving, net capital transfers and net acquisitions of non-fi nancial assets.

Central parity (or central rate): the exchange rate of each ERM II member currency vis-à-vis the

euro, around which the ERM II fl uctuation margins are defi ned.

Compensation per employee or per hour worked: the total remuneration, in cash or in kind, that

is payable by employers to employees, i.e. gross wages and salaries, as well as bonuses, overtime

payments and employers’ social security contributions, divided by the total number of employees

or by the total number of employees’ hours worked.

Consolidated balance sheet of the MFI sector: a balance sheet obtained by netting out inter-

MFI positions (e.g. inter-MFI loans and deposits) in the aggregated MFI balance sheet. It provides

statistical information on the MFI sector’s assets and liabilities vis-à-vis residents of the euro area

not belonging to this sector (i.e. the general government and other euro area residents) and vis-à-vis

non-euro area residents. It is the main statistical source for the calculation of monetary aggregates,

and it provides the basis for the regular analysis of the counterparts of M3.

Collateral: assets pledged or transferred in some form as a guarantee for the repayment of loans,

as well as assets sold under repurchase agreements. Collateral used in Eurosystem reverse

transactions must fulfi l certain eligibility criteria.

Current account: a b.o.p. account that covers all transactions in goods and services, income and

current transfers between residents and non-residents.

VII

ECB

Monthly Bulletin

May 2011

Debt (financial accounts): loans taken out by households, as well as the loans, debt securities

and pension fund reserves (resulting from employers’ direct pension commitments on behalf

of their employees) of non-fi nancial corporations, valued at market prices at the end of the period.

Debt (general government): the gross debt (currency and deposits, loans and debt securities)

at nominal value outstanding at the end of the year and consolidated between and within the sectors

of general government.

Debt security: a promise on the part of the issuer (i.e. the borrower) to make one or more

payment(s) to the holder (the lender) on a specifi ed future date or dates. Such securities usually

carry a specifi c rate of interest (the coupon) and/or are sold at a discount to the amount that will

be repaid at maturity. Debt securities issued with an original maturity of more than one year are

classifi ed as long-term.

Debt-to-GDP ratio (general government): the ratio of general government debt to GDP at

current market prices. It is the subject of one of the fi scal criteria laid down in Article 126(2) of the

Treaty on the Functioning of the European Union to defi ne the existence of an excessive defi cit.

Deficit (general government): the general government’s net borrowing, i.e. the difference between

total government revenue and total government expenditure.

Deficit-debt adjustment (general government): the difference between the general government

defi cit and the change in general government debt.

Deficit ratio (general government): the ratio of the general government defi cit to GDP at current

market prices. It is the subject of one of the fi scal criteria laid down in Article 126(2) of the Treaty

on the Functioning of the European Union to defi ne the existence of an excessive defi cit. It is also

referred to as the budget defi cit ratio or the fi scal defi cit ratio.

Deflation: a generalised, persistent and self-reinforcing decline in a broad set of prices that results

from a drop in aggregate demand and becomes entrenched in expectations.

Deposit facility: a standing facility of the Eurosystem enabling eligible counterparties to

make, on their own initiative, overnight deposits with the NCB in their respective jurisdiction.

Deposits are remunerated at a pre-specifi ed rate that normally provides a fl oor for overnight market

interest rates.

Disinflation: a process of decelerating infl ation that may lead to negative infl ation rates of

a temporary nature.

Direct investment: cross-border investment for the purpose of obtaining a lasting interest in an

enterprise resident in another economy (assumed, in practice, for ownership of at least 10% of the

ordinary shares or voting power). Included are equity capital, reinvested earnings and other capital

associated with inter-company operations. The direct investment account records net transactions/

positions in assets abroad by euro area residents (as “direct investment abroad”) and net transactions/

positions in euro area assets by non-residents (as “direct investment in the euro area”).

Effective exchange rates (EERs) of the euro (nominal/real): weighted averages of bilateral

euro exchange rates against the currencies of the euro area’s main trading partners. The EER

VIII

ECB

Monthly Bulletin

May 2011

GLOSSARY

indices of the euro are calculated against different groups of trading partners: the EER-20 comprises

the 10 non-euro area EU Member States and 10 trading partners outside the EU, and the EER-40

encompasses the EER-20 and 20 additional countries. The weights used refl ect the share of each

partner country in the euro area’s trade in manufactured goods and account for competition in

third markets. Real EERs are nominal EERs defl ated by a weighted average of foreign, relative to

domestic, prices or costs. They are thus measures of price and cost competitiveness.

Enhanced credit support: the non-standard measures taken by the ECB/Eurosystem during the

fi nancial crisis with a view to supporting fi nancing conditions and credit fl ows above and beyond

what could be achieved through reductions in key ECB interest rates alone.

EONIA (euro overnight index average): a measure of the effective interest rate prevailing in the

euro interbank overnight market. It is calculated as a weighted average of the interest rates on unsecured

overnight lending transactions denominated in euro, as reported by a panel of contributing banks.

Equities: securities representing ownership of a stake in a corporation, e.g. shares traded on stock

exchanges (quoted shares), unquoted shares and other forms of equity. Equities usually produce

income in the form of dividends.

ERM II (exchange rate mechanism II): the exchange rate arrangement that provides the

framework for exchange rate policy cooperation between the euro area countries and the

EU Member States not participating in Stage Three of EMU.

EURIBOR (euro interbank offered rate): the rate at which what is known as a prime bank is

willing to lend funds (denominated in euro) to another prime bank. The EURIBOR is computed

daily, based on the rates of a sample of selected banks, for different maturities of up to 12 months.

Euro area: the area formed by those EU Member States in which the euro has been adopted as the

single currency in accordance with the Treaty on the Functioning of the European Union.

European Commission surveys: harmonised surveys of business and/or consumer sentiment

conducted on behalf of the European Commission in each of the EU Member States. Such

questionnaire-based surveys are addressed to managers in the manufacturing, construction, retail

and services industries, as well as to consumers. From each monthly survey, composite indicators

are calculated that summarise the replies to a number of different questions in a single indicator

(confi dence indicators).

Eurosystem: the central banking system made up of the ECB and the NCBs of those EU

Member States whose currency is the euro.

Eurozone Purchasing Managers’ Surveys: surveys of business conditions in manufacturing and

in services industries conducted for a number of countries in the euro area and used to compile

indices. The Eurozone Manufacturing Purchasing Managers’ Index (PMI) is a weighted indicator

calculated from indices of output, new orders, employment, suppliers’ delivery times and stocks

of purchases. The services sector survey asks questions on business activity, expectations of future

business activity, the amount of business outstanding, incoming new business, employment, input

prices and prices charged. The Eurozone Composite Index is calculated by combining the results

from the manufacturing and services sector surveys.

IX

ECB

Monthly Bulletin

May 2011

External trade in goods: exports and imports of goods with countries outside the euro area,

measured in terms of value and as indices of volume and unit value. External trade statistics are

not comparable with the exports and imports recorded in the national accounts, as the latter include

both intra-euro area and extra-euro area transactions, and also combine goods and services. Nor are

they fully comparable with the goods item in b.o.p. statistics. Besides methodological adjustments,

the main difference is that imports in external trade statistics are recorded including insurance and

freight services, whereas they are recorded free on board in the goods item in the b.o.p. statistics.

Financial account: a b.o.p. account that covers transactions between residents and non-residents in

direct investment, portfolio investment, other investment, fi nancial derivatives and reserve assets.

Financial accounts: part of the system of national (or euro area) accounts showing the fi nancial

positions (stocks or balance sheets), fi nancial transactions and other changes of the different

institutional sectors of an economy by type of fi nancial asset.

Financial vehicle corporation (FVC): an entity whose principal activity is to carry out

securitisation transactions. An FVC typically issues marketable securities that are offered for sale

to the general public, or sold in the form of private placements. In some cases, an FVC simply holds

the securitised assets and issues the securities through another entity, often an FVC itself.

Fixed rate tender: a tender procedure in which the interest rate is specifi ed in advance by the

central bank and in which participating counterparties bid the amount of money they wish to

transact at the fi xed interest rate.

Fixed rate full-allotment tender procedure: a tender procedure in which the interest rate is

pre-specifi ed by the central bank (fi xed rate) and in which counterparties bid the amount of

money they want to transact at that rate, knowing in advance that all their bids will be satisfi ed

(full allotment).

General government: a sector defi ned in the ESA 95 as comprising resident entities that are

engaged primarily in the production of non-market goods and services intended for individual and

collective consumption and/or in the redistribution of national income and wealth. Included are

central, regional and local government authorities as well as social security funds. Excluded are

government-owned entities that conduct commercial operations, such as public enterprises.

Gross domestic product (GDP): the value of an economy’s total output of goods and services less

intermediate consumption, plus net taxes on products and imports. GDP can be broken down by

output, expenditure or income components. The main expenditure aggregates that make up GDP are

household fi nal consumption, government fi nal consumption, gross fi xed capital formation, changes

in inventories, and imports and exports of goods and services (including intra-euro area trade).

Gross external debt: the outstanding amount of an economy’s actual (i.e. non-contingent)

current liabilities that require payment of principal and/or interest to non-residents at some point

in the future.

Harmonised Index of Consumer Prices (HICP): a measure of the development of consumer

prices that is compiled by Eurostat and harmonised for all EU Member States.

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ECB

Monthly Bulletin

May 2011

GLOSSARY

Hourly labour cost index: a measure of labour costs, including gross wages and salaries

(in cash and in kind, including bonuses) and other labour costs (employers’ social contributions

plus employment-related taxes paid by the employer minus subsidies received by the employer),

per hour actually worked (including overtime).

Implied volatility: the expected volatility (i.e. standard deviation) in the rates of change of the

price of an asset (e.g. a share or a bond). It can be derived from the asset’s price, maturity date and

exercise price of its options, as well as from a riskless rate of return, using an option pricing model

such as the Black-Scholes model.

Index of negotiated wages: a measure of the direct outcome of collective bargaining in terms of

basic pay (i.e. excluding bonuses) at the euro area level. It refers to the implied average change in

monthly wages and salaries.

Industrial producer prices: factory-gate prices (transportation costs are not included) of

all products sold by industry, excluding construction, on the domestic markets of the euro area

countries, excluding imports.

Industrial production: the gross value added created by industry at constant prices.

Inflation: an increase in the general price level, e.g. in the consumer price index.

Inflation-indexed government bonds: debt securities issued by the general government, the

coupon payments and principal of which are linked to a specifi c consumer price index.

Insurance corporations and pension funds: a sector defi ned in the ESA 95 as comprising

all fi nancial corporations and quasi-corporations that are engaged primarily in fi nancial

intermediation as the consequence of the pooling of risks.

International investment position (i.i.p.): the value and composition of an economy’s outstanding

net fi nancial claims on (or fi nancial liabilities to) the rest of the world.

International reserves: external assets readily available to and controlled by monetary authorities

for directly fi nancing or regulating the magnitude of payment imbalances through intervention in

exchange markets. The international reserves of the euro area comprise non-euro-denominated

claims on non-euro area residents, gold, special drawing rights and the reserve positions in the IMF

which are held by the Eurosystem.

Investment funds (except money market funds): fi nancial institutions that pool capital raised

from the public and invest it in fi nancial and non-fi nancial assets. See also MFIs.

Job vacancies: a collective term covering newly created jobs, unoccupied jobs or jobs about to

become vacant in the near future, for which the employer has recently taken active steps to fi nd a

suitable candidate.

Key ECB interest rates: the interest rates, set by the Governing Council, which refl ect the

monetary policy stance of the ECB. They are the rates at the main refi nancing operations, on the

marginal lending facility and on the deposit facility.

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ECB

Monthly Bulletin

May 2011

Labour force: the sum total of persons in employment and the number of unemployed.

Labour productivity: the output that can be produced with a given input of labour. It can be

measured in several ways, but is commonly measured as GDP (volume) divided by either total

employment or total hours worked.

Liquidity-absorbing operation: an operation through which the Eurosystem absorbs liquidity

in order to reduce excess liquidity, or to create a shortage of liquidity. Such operations can

be conducted by issuing debt certifi cates or fi xed-term deposits.

Longer-term refinancing operation (LTRO): an open market operation with a maturity of more

than one week that is executed by the Eurosystem in the form of a reverse transaction. The regular

monthly operations have a maturity of three months. During the fi nancial market turmoil that started

in August 2007, supplementary operations with maturities ranging from one maintenance period

to one year were conducted, the frequency of which varied.

M1: a narrow monetary aggregate that comprises currency in circulation plus overnight deposits

held with MFIs and central government (e.g. at the post offi ce or treasury).

M2: an intermediate monetary aggregate that comprises M1 plus deposits redeemable at a period

of notice of up to and including three months (i.e. short-term savings deposits) and deposits with an

agreed maturity of up to and including two years (i.e. short-term time deposits) held with MFIs and

central government.

M3: a broad monetary aggregate that comprises M2 plus marketable instruments, in particular

repurchase agreements, money market fund shares and units, and debt securities with a maturity of

up to and including two years issued by MFIs.

Main refinancing operation (MRO): a regular open market operation executed by the Eurosystem

in the form of reverse transactions. Such operations are carried out through a weekly standard tender

and normally have a maturity of one week.

Marginal lending facility: a standing facility of the Eurosystem enabling eligible counterparties,

on their own initiative, to receive overnight credit from the NCB in their jurisdiction at a

pre-specifi ed rate in the form of a reverse transaction. The rate on loans extended within the scope of

the marginal lending facility normally provides an upper bound for overnight market interest rates.

MFI credit to euro area residents: MFI loans granted to non-MFI euro area residents (including

general government and the private sector) and MFI holdings of securities (shares, other equity and

debt securities) issued by non-MFI euro area residents.

MFI interest rates: the interest rates that are applied by resident credit institutions and other MFIs,

excluding central banks and money market funds, to euro-denominated deposits and loans vis-à-vis

households and non-fi nancial corporations resident in the euro area.

MFI longer-term financial liabilities: deposits with an agreed maturity of over two years,

deposits redeemable at a period of notice of over three months, debt securities issued by euro area

MFIs with an original maturity of more than two years and the capital and reserves of the euro area

MFI sector.

XII

ECB

Monthly Bulletin

May 2011

GLOSSARY

MFI net external assets: the external assets of the euro area MFI sector (such as gold, foreign

currency banknotes and coins, securities issued by non-euro area residents and loans granted to

non-euro area residents) minus the external liabilities of the euro area MFI sector (such as non-euro

area residents’ deposits and repurchase agreements, as well as their holdings of money market fund

shares/units and debt securities issued by MFIs with a maturity of up to and including two years).

MFIs (monetary financial institutions): fi nancial institutions which together form the money-

issuing sector of the euro area. These include the Eurosystem, resident credit institutions (as defi ned

in Community law) and all other resident fi nancial institutions whose business is to receive deposits

and/or close substitutes for deposits from entities other than MFIs and, for their own account

(at least in economic terms), to grant credit and/or invest in securities. The latter group consists

predominantly of money market funds, i.e. funds that invest in short-term and low-risk instruments

usually with a maturity of one year or less.

Minimum bid rate: the lower limit to the interest rates at which counterparties may submit bids in

the variable tenders.

Open market operation: a fi nancial market operation executed on the initiative of the central

bank. These operations include reverse transactions, outright transactions as well as the issuance

of fi xed-term deposits or debt certifi cates or foreign exchange swaps. The open market operations

can be liquidity providing or liquidity absorbing.

Other investment: an item in the b.o.p. and the i.i.p. that covers the fi nancial transactions/positions

with non-residents in trade credits, deposits and loans, and other accounts receivable and payable.

Portfolio investment: euro area residents’ net transactions and/or positions in securities issued

by non-residents of the euro area (“assets”) and non-residents’ net transactions and/or positions in

securities issued by euro area residents (“liabilities”). Included are equity securities and debt securities

(bonds and notes, and money market instruments). Transactions are recorded at the effective price

paid or received, less commissions and expenses. To be regarded as a portfolio asset, ownership in

an enterprise must be equivalent to less than 10% of the ordinary shares or voting power.

Price stability: as defi ned by the Governing Council, a year-on-year increase in the HICP for the

euro area of below 2%. The Governing Council has also made it clear that, in the pursuit of price

stability, it aims to maintain infl ation rates below, but close to, 2% over the medium term.

Purchasing power parity (PPP): the rate at which one currency is converted into another so as

to equalise the purchasing power of the two currencies by eliminating the differences in the price

levels prevailing in the countries concerned. In their simplest form, PPPs show the ratio of the

prices in national currency of the same good or service in different countries.

Reference value for M3 growth: the annual growth rate of M3 that is deemed to be compatible

with price stability over the medium term.

Reserve requirement: the requirement for institutions to hold minimum reserves with the central

bank over a maintenance period. Compliance with the requirement is determined on the basis of

the average of the daily balances in the reserve accounts over the maintenance period.

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ECB

Monthly Bulletin

May 2011

Reverse transaction: an operation whereby the NCB buys or sells assets under a repurchase

agreement or conducts credit operations against collateral.

Securitisation: a transaction or scheme whereby an asset or a pool of cash fl ow-producing assets,

often consisting of loans (mortgages, consumer loans, etc.), is transferred from an originator (usually

a credit institution) to a fi nancial vehicle corporation (FVC). The FVC effectively converts these

assets into marketable securities by issuing debt instruments with principal and interest serviced

through the cash fl ows produced by the asset pool.

Survey of Professional Forecasters (SPF): a quarterly survey that has been conducted by the

ECB since 1999 to collect macroeconomic forecasts on euro area infl ation, real GDP growth and

unemployment from a panel of experts affi liated to fi nancial and non-fi nancial organisations based

in the EU.

Unit labour costs: a measure of total labour costs per unit of output calculated for the euro area as

the ratio of total compensation per employee to labour productivity (defi ned as GDP (volume) per

person employed).

Variable rate tender: a tender procedure where the counterparties bid both the amount of money

they wish to transact with the central bank and the interest rate at which they wish to enter into the

transaction.

Volatility: the degree of fl uctuation in a given variable.

Write-down: a downward adjustment to the value of loans recorded in the balance sheets of MFIs

when it is recognised that the loans have become partly unrecoverable.

Write-off: the removal of the value of loans from the balance sheets of MFIs when the loans are

considered to be totally unrecoverable.

Yield curve: a graphical representation of the relationship between the interest rate or yield and the

residual maturity at a given point in time for suffi ciently homogenous debt securities with different

maturity dates. The slope of the yield curve can be measured as the difference between the interest

rates or yield at two selected maturities.

XIV